This report helps automotive suppliers inform their legal and operational decisions to help address challenges and opportunities. Contact your Foley relationship partner, or John R. Trentacosta or Ann Marie Uetz, to follow up.
Key Developments
- Foley & Lardner partners assessed the
recent federal appeals court decision
allowing OSHA's ETS to move forward
in regards to COVID-19 vaccine
requirements for employers with 100 or more
employees.
- IHS Markit forecasts new light-vehicle sales of
almost 82.4 million units worldwide in 2022, representing an
increase of 3.7% from nearly 79.4 million units in 2021. IHS
expects that semiconductor supply shortages will continue to impact
demand next year.
- Consultancy Roland Berger predicts semiconductor supplies
will remain constrained through 2022.Automakers are
advised to accelerate the transition to centralized
electronic architectures and advanced and
leading-edge nodes.
- The U.S. Environmental Protection
Agency is
finalizing new passenger vehicle emissions standards that
take effect with model year 2023, and will require
a cumulative 28.3% reduction in
vehicle emissions fleetwide through 2026.
- Approximately 1% of GM Canada's
workforce has not complied with deadlines to either
report vaccination status and show proof of full vaccination
(December 8), or meet the deadline to be fully vaccinated (December
12).
- DHL Supply Chain ordered 100 autonomous trucks
co-developed
by Navistar and TuSimple.
DHL and TuSimple operate a pilot program to transport freight
between Dallas and San Antonio, Texas.
- Electric vehicles and low emissions
technology:
-
- Toyota will invest $35 billion in
battery-powered EVs and plans to have 30 models by
2030.The automaker also intends for all models in its Lexus brand
to be electric by the end of the decade.
- Rivian will invest $5 billion to build a second U.S. manufacturing
site in Georgia, which will have an
annual capacity of 400,000 vehicles and begin production in
2024.
- FedEx received the first of 500 all-electric
light commercial vans it has ordered from GM's electric
delivery and logistics unit BrightDrop.
- Sen. Joe Manchin (D-WV) stated he would not support the $2
trillion Build Back Better bill,
resulting in a shortfall of the required votes to pass this version
of the legislation. This social spending bill includes a provision
that would offer consumer tax
credits for electric vehicles that
are union-made in the U.S. [This topic
continues to evolve].
- The Alliance for Automotive Innovation estimates that third-quarter zero emission vehicle (ZEV) sales represented 3.9% of the U.S. market, up from 2% in the same period last year.
- Toyota will invest $35 billion in
battery-powered EVs and plans to have 30 models by
2030.The automaker also intends for all models in its Lexus brand
to be electric by the end of the decade.
Market Trends and Regulatory
- The North American International Auto
Show is tentatively scheduled for September 14-25,
2022, according to The Detroit News. Due to the
coronavirus pandemic, Michigan has not hosted NAIAS since January
2019.Michigan lawmakers recently approved a $1
billion spending bill to attract economic
investment in the state, and that package includes a
one-time grant of $9 million for NAIAS.
- The 2022 Montreal International Auto Show,
Canadian International AutoShow and Vancouver International Auto Show have
each been canceled due
to escalating COVID-19 cases in
Canada. The events were scheduled for January, February,
and March, respectively.
- The auto industry could experience shortages of
the electrical steel needed in EV motors beginning in
2025, according to IHS Markit.
- According to Bernard Swiecki, director of research for
the Center for Automotive Research,
the impact of the chip shortage on the
automotive industry is "somewhat doubled compared with other
sectors." At SemiCon West this month, Swiecki also noted that
the auto industry's shift toward electrification
will "place pressure on semiconductor supply,"
in regards to both vehicles and charging infrastructure.
- Guidehouse Insights expects that as a result of global chip
shortages, automakers will pursue new sourcing strategies,
including forming agreements and partnerships directly
with chipmakers.
- The nominee to serve as the head the National Highway Traffic Safety Administration, Steven Cliff, told a Senate panel last week that he was committed to reducing traffic fatalities. Cliff was previously a California Air Resources Board official and has served as NHTSA's deputy administrator since February.
OEMs/Suppliers
- Toyota estimates a production loss of 14,000
vehicles in December, up from a previous estimate of 9,000
vehicles, due to temporary shutdowns at its plants
in Japan that were caused by parts
shortages. The automaker plans to produce 800,000 vehicles globally
in January, as it increases production to make up for the output
lost this year.
- The CFOs of GM and Ford are playing pivotal roles in
transforming their businesses in response to the auto
industry's shift toward electric, connected, and autonomous
vehicles, according to recent interviews in The Wall
Street Journal.
- Corvette production at GM's plant in Bowling Green,
Kentucky resumed this week after a shutdown due to
tornado damage.
- Toyota will open portions of
its Arizona Proving Grounds to other
automakers as a contract testing resource.
- Over a dozen major automakers are in the process of meeting a voluntary commitment to equip nearly all vehicles with automatic emergency braking (AEB) by the production year beginning Sept. 1, 2022.
Connected/Autonomous Vehicles and Mobility Services
- Autonomous vehicle technology developer Aurora
Innovation is operating a pilot
program with Uber Freight to
move goods in Texas.
- Cruise CEO Dan Ammann will depart GM's autonomous-vehicle unit, reportedly over differences in vision for mission and strategy. Kyle Vogt will serve as the division's interim CEO.
Electric Vehicles and Low Emissions Technology
- Nissan intends to build battery
recycling facilities at unspecified locations in the
U.S. and Europe by fiscal year 2025, as part of an effort to reduce
costs amid high prices for rare metals.
- Chevrolet Bolt production downtime at
GM's Lake Orion Assembly plant was extended through February as the
automaker continues work on the vehicle's battery-related
recall.
- Ford announced its Pro
Charging service to provide commercial
EV customers with "integrated end-to-end
charging solutions including consultation on depot site design,
installation, operations, maintenance, and support."
- Canoo will exit a deal with VDL
Nedcar in the Netherlands to serve as its contract
manufacturer in Europe, citing the intent to focus on U.S.
manufacturing in order to reduce supply chain vulnerabilities.
Canoo plans to begin production in Arkansas next year, with
production in Oklahoma beginning in "late 2023."
- Chinese electric car maker Nio revealed its second model, the ET5
all-electric sedan, and it will begin deliveries in September
2022.The vehicle is positioned as a competitor to Tesla's Model
3.
- GM plans to reveal more about its strategy
for mass-market electric
vehicles at CES in Las
Vegas in January.At the time of this newsletter
publication, CES 2022 is a live,
in-person event; updates on health protocols are posted here.
- Volvo Group, Daimler Truck, and Volkswagen's heavy-truck business the Traton Group formed a joint venture to install and operate a public charging network for electric, heavy-duty, long-haul trucks and buses in Europe.
Prepared by Julie Dautermann, Competitive Intelligence Analyst
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.