Analysis by Julie Dautermann, Competitive Intelligence Analyst
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 launched a Supply Chain Disruption Series to help clients
navigate a range of market challenges including extreme price
increases, record-setting inflation, production-threatening delays,
and attempts to renegotiate longstanding supply agreements. Read the first installment and subscribe here.
- LMC Automotive estimates U.S. new light-vehicle sales
reached 5.65 million units in the first five
months of 2022, representing a decline of 19% from the
same period in 2021, and up by approximately 6% from 2020.
- U.S. fleet sales were down by 16.1% in May
2022 compared to the same period last year, according to estimates from Cox Automotive.
- Kelley Blue Book reports new-vehicle average transaction
prices reached $47,148 in May 2022, representing an
increase of 13.5% compared to the same period one year ago.
- The semiconductor shortage has contributed to
a global production loss of nearly two million vehicles
this year, according to estimates by AutoForecast
Solutions LLC quoted in The Detroit News.
- GM's Cruise LLC became the first company
to receive a permit to charge for autonomous
vehicle rides in California without a safety driver present. The
permit allows for AV passenger service to the general public during
designated hours on select streets in San Francisco under specific
conditions.
- Apple revealed plans to expand integration of its
CarPlay software into the instrument cluster on
vehicle dashboards beginning next year.
- Electric vehicles and low emissions
technology:
-
- The U.S. Department of Transportation proposed minimum standards and requirements
for installing, operating and maintaining federally funded
EV charging stations.
- Boston Consulting Group predicts battery electric vehicles will
represent 20% of global light-vehicle sales in
2025 and 59% in 2035, up from previous
projections of 11% and 45%, respectively.
- BloombergNEF warned elevated prices for lithium,
cobalt and nickel could result in a delay
of "several years" before EVs reach cost parity with ICE
vehicles.
- The European Union voted to uphold plans banning the sale of new vehicles
with internal combustion engines by 2035.
- Tesla plans to cut 10% of its salaried workforce, with CEO Elon Musk indicating the company had "become overstaffed in many areas," but its hourly workforce is expected to increase.
- The U.S. Department of Transportation proposed minimum standards and requirements
for installing, operating and maintaining federally funded
EV charging stations.
Market Trends and Regulatory
- The Wall Street Journal reports the
National Highway Traffic Safety Administration
intends to release new data this month about vehicle crashes
involving advanced driver-assistance systems and
automated-driving technologies.
- Gasoline recently reached a nationwide average of $5 per gallon
for the first time, representing an increase of nearly $2 from this
time last year according to estimates by AAA.
- According to the May 2022 Consumer Price Index, new vehicle prices were up 1% and used vehicle prices rose 1.8% from the prior month. Compared to May 2021, new vehicle prices were up by 12.6% and used vehicle prices were up by 16.1%.
OEMs/Suppliers
- Bloomberg reports
Denso is considering a potential spin-off of its
automotive chip business; however, nothing has been decided at this
time.
- Ford will invest $3.7 billion and add 6,200 union
jobs at three plants in Michigan,
Ohio and Missouri for the purpose
of expanding production of electric and internal combustion engine
vehicles.
- GM will eliminate a four-year degree requirement for many of its jobs to instead focus on skills-based hiring, according to a report in Automotive News.
Connected/Autonomous Vehicles and Mobility Services
- The Center for Automotive Research indicates
consumer education about the capabilities and limitations of
advanced driver assistance systems is essential to
increase vehicle safety benefits and prevent accidents.
- Waymo will deploy its autonomous trucks on the
Uber Freight network as part of a new strategic partnership involving "a deep
product integration and long-term collaboration
roadmap."
- As part of a new partnership with Georgia-Pacific and KBX, autonomous vehicle provider Gatik will deliver goods to a network of Sam's Club stores in the Dallas-Fort Worth area beginning next month.
Electric Vehicles and Low Emissions Technology
- Bosch announced plans to invest $420 million in
Mobility Solutions for North America, including
climate-neutral technology and the
hydrogen economy.
- GM's Buick vehicles will
be all-electric by 2030 in North America, and the
brand's first EV model is planned for 2024.
- NextStar Energy, a joint venture between
Stellantis and LG Energy
Solution, intends to begin construction on its $4.1
billion EV battery plant in Windsor, Ontario later this year.
- Controlled Thermal Resources Ltd. will supply battery-grade lithium hydroxide to
Stellantis for use in North American EV
production. CTR is recovering lithium from geothermal brines in its
Hell's Kitchen Project in California's Imperial County off
the Salton Sea.
- Colorado-based battery company Solid Power
began pilot production of solid-state EV batteries,
and intends to deliver prototypes to Ford and
BMW by year-end.
- Canadian electric vehicle charging company FLO
will invest $3 million to open its first U.S. manufacturing
facility in Auburn Hills, Michigan later this year.
- The co-founder of autonomous driving company TuSimple started a new company, Hydron, focused on developing Class 8 hydrogen-powered autonomous trucks.
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.