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
- Although some feared a wave of pandemic-related Chapter 11
cases, the auto industry isn't likely to see many immediate
bankruptcies, according to Foley &
Lardner partner Ann Marie Uetz in Bloomberg Law.
- U.S. new light-vehicle sales for full-year
2021 reached 14.9
million units, and
the SAAR for December was 12.4 million units,
according to analysis by J.D. Power and LMC
Automotive, and NADA. Low inventory
is expected to continue impacting sales in 2022, with U.S. sales
projected at 15.9 million units.
- U.S. fleet sales reached an estimated 1.6
million units in 2021, 42% lower than the 2.8 million
units sold in 2019, and 4% lower compared to 2020.
- An estimated 2.3 million
light-vehicle production units were lost in North
America last year due to limited semiconductor supplies and other
disruptions.
-
Toyota overtook GM as
the top-selling automaker in
the U.S. based on annual sales, as the former benefitted
from earlier decisions to increase inventory of key components such
as semiconductors.
- A recent article by Foley
& Lardner attorneys discusses the impact of
increased vehicle computerization and electrification
on patent infringement suits in the automotive
sector.
- Qualcomm announced deals to supply chips
to Volvo, Honda, and Renault, signaling
its continued efforts to expand in automotive platforms.
- Intel's autonomous driving
unit Mobileye announced new
collaborations
with Volkswagen, Ford and
Geely's electric mobility
brand Zeekr, for driver assist and autonomous
vehicle technologies.
- Electric vehicles and low emissions
technology:
-
- Automakers' shift to electrification
intensifies, as evidenced by a number of
announcements at the CES conference in
Las Vegas, including GM's debut of electric
versions of its Chevrolet Silverado pickup
truck, as well as the Chevrolet Equinox and Blazer, which
all begin sales in 2023.As part of a broad partnership announcement focused on vehicle
software and solutions, Amazon will be
the first commercial customer for Stellantis'
upcoming Ram ProMaster battery electric delivery
vans, which are due to launch in 2023.Stellantis also
announced that its Chrysler brand will
have an all-electric lineup by
2028.
- Citing strong consumer
demand, Ford will
double annual production capacity for
its all-electric F-150 Lightning to
150,000 trucks a year by mid-2023. The first deliveries are
expected to begin this spring.
- Sony displayed a prototype electric SUV at CES, and will explore a commercial launch of its own vehicles through its upcoming new unit, Sony Mobility Inc.
- Shortages of raw materials are predicted to be a risk for EV supply
chains, particularly for companies that are not pursuing robust
agreements with suppliers.
- Guidehouse Insights predicts that annual plug-in electric vehicle (PEV) sales in North America will grow at a 30% compound annual growth rate through 2030.
- Automakers' shift to electrification
intensifies, as evidenced by a number of
announcements at the CES conference in
Las Vegas, including GM's debut of electric
versions of its Chevrolet Silverado pickup
truck, as well as the Chevrolet Equinox and Blazer, which
all begin sales in 2023.As part of a broad partnership announcement focused on vehicle
software and solutions, Amazon will be
the first commercial customer for Stellantis'
upcoming Ram ProMaster battery electric delivery
vans, which are due to launch in 2023.Stellantis also
announced that its Chrysler brand will
have an all-electric lineup by
2028.
Market Trends and Regulatory
- Mexico will pursue an arbitration
panel to help resolve differences with the U.S. over the
interpretation of the USMCA's rules of
origin for vehicle components.
- Six states have adopted Advanced Clean
Truck rules that require increasing percentages
of medium- and heavy-duty trucks sold to be zero-emissions
beginning in 2025.
- Senate Democrats currently have no plans to pursue floor
action for the $2 trillion Build Back
Better bill.The social spending bill, which included
a provision that would
offer consumer tax credits for
electric vehicles that are union-made in
the U.S., may require a complete revision because it has
thus far failed to receive adequate support for passage. House
Speaker Nancy Pelosi said in a recent
interview that "she believes a deal can still be
reached."
- GM agreed to recognize California's authority to set vehicle emission standards under the Clean Air Act, in a move that makes the automaker eligible for government fleet purchases in the state.
OEMs/Suppliers
- Volkswagen will provide a
10% pay raise to its assembly plant workers in Chattanooga,
Tennessee, due to the impact of the COVID-19 omicron variant on an
already-stretched labor market. The seven-day average for newly
reported COVID-19 cases in the
U.S. surpassed 700,000 for the first time, according
to data from Johns Hopkins as quoted in The Wall Street
Journal.
- Stellantis pushed back a
deadline requiring U.S. salaried employees to receive COVID-19
vaccinations, noting that the new timetable is dependent on where
and how an employee is working. The automaker said
that 93% of its U.S. salaried workforce is COVID-19
vaccinated.
- Bosch indicated that
combining artificial
intelligence with connected
products will assist in expanding revenue platforms
across its business portfolios.
- BMW is working with 3D perception
solution company Seoul
Robotics to automate last-mile fleet
logistics at its manufacturing facility in Munich.
- Hyundai is exploring ways to introduce advanced robotic technology into a wide variety of mobility systems, including cars, urban air mobility vehicles, and wearable robots such as human exoskeletons.
Connected/Autonomous Vehicles and Mobility Services
- GM announced its
upcoming Ultra Cruise driver assistance
system, which was developed
with Qualcomm, and expands on the hands-free
driving capabilities offered in Super Cruise. Ultra Cruise will
debut on certain Cadillac models in 2023. The systems are
considered Level 2 in SAE's definitions of driving
automation.
- TuSimple expanded its
partnership with Nvidia, and will
use the company's chips for an autonomous domain controller for
its commercial self-driving trucks.
- Torc Robotics, an independent subsidiary
of Daimler Truck, will open its
third U.S. location in Austin, Texas this year. The site will be an
engineering hub to accelerate development of its self-driving truck
technology.
- Volvo announced its autonomous driving feature, Ride Pilot, will first be available to customers in California before a broader launch in other markets. Ride Pilot will be available as an add-on subscription in the automaker's upcoming full-electric flagship crossover, pending internal verification and regulatory approvals.
Electric Vehicles and Low Emissions Technology
- Magna announced plans
for a new electric vehicle center at its U.S. headquarters in
Troy, Michigan, and its electric powertrain system will be ready to
launch beginning in 2025.
- In a recent test, Michigan battery company Our
Next Energy (ONE) used its technology to power a 2021
Tesla Model S for 752 miles on a single
charge.
- Tesla's strategies to succeed amid global
supply chain challenges include vertical integration,
increasing vehicle prices to address higher costs, removing some
features from vehicles, and maintaining close relationships with
chip suppliers. Tesla recently indicated goals to expand
into solar power and battery
storage.
- Panasonic will
produce Tesla battery cells using
certain components from Nevada-based battery recycling
company Redwood Materials.
- Massachusetts-based startup Battery
Resourcers will invest $43
million to open a recycling plant for lithium-ion batteries in
Georgia this year.
- GM's electric delivery and logistics
unit BrightDrop will
supply Walmart with 5,000 electric
delivery vans, and FedEx has expanded
its order from an initial reservation of 500 to 2,000
vehicles.
- Honda plans to build
a second all-electric vehicle plant in China, which will begin
production in 2024 as a joint operation with Dongfeng
Motor Co.
- Vietnam-based EV company VinFast plans to
assemble battery packs with cells sourced from its supplier at an
upcoming manufacturing site in the U.S. VinFast intends to select
the site this year.
- In March, Volkswagen will debut an electric version of its 1960s-era microbus, called the ID.Buzz.
Prepared by Julie Dautermann, Competitive Intelligence Analyst
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