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
- The third installment in Foley &
Lardner's Supply Chain Disruption Series provides a
number of strategies to protect supply chains and mitigate
risks against financially distressed customers and
suppliers. Click here to subscribe to the series.
- The North American International Auto Show announced all tickets began sales on Monday,
July 11.The indoor and outdoor event will be held September 14-25,
2022 at Huntington Place, Hart Plaza and throughout downtown
Detroit. Foley & Lardner's Auto Show
Program will be held in Detroit on September 14, 2022 and
details will be provided in an upcoming post.
- According to data from LMC Automotive, U.S. new light-vehicle
sales reached an estimated 6.78 million units in
the first half of 2022, representing a decline of 1.5
million units from the same period last year. In response to H1
results, LMC revised its full-year 2022 U.S. light-vehicle
sales forecast from 15 million units to 14.3
million units.
- The National Automobile Dealers Association
estimates U.S. new light-vehicle sales reached a
SAAR of 13.4 million units in the second quarter,
following the first quarter's SAAR of 14.1 million units.
- The Federal Trade Commission released a
proposed Motor Vehicle Dealers Trade Regulation Rule
addressing certain aspects of car dealership trade
practices, including price advertising and product financing
disclosures.
- The U.S. Transportation Department's Federal Highway
Administration announced a new proposed rule that would require state
transportation departments to establish greenhouse gas
emissions targets for vehicles and report on
progress.
- A U.S. District Court judge again postponed a ruling in a case concerning Massachusetts' "right-to-repair" law pertaining to whether automakers will have to allow independent repair shops access to vehicles' electronic data systems.
- Electric vehicles and low emissions
technology:
-
- The annual Car Wars study from Bank of America
Merrill Lynch projects 60% of new models launched
over the next four years will be either electric or
hybrid. The report also predicts GM and Ford will surpass
Tesla in U.S. EV sales by mid-decade.
- Tesla delivered 254,695 vehicles in the second
quarter of 2022, compared to 201,250 deliveries in the same period
last year, and down from 310,048 deliveries in
the first quarter of 2022.
- Hyundai-Kia and Ford were the
top two challengers to Tesla based on
U.S. EV market share for the first five months of this year.
- Volkswagen will invest €20 billion this decade with
partners on battery cell production through a newly created company
called PowerCo.
- After selling its 200,000th plug-in electric vehicle during the second quarter, Toyota became the third automaker to reach the cap resulting in the phase-out of a $7,500 U.S. federal tax credit.
- The annual Car Wars study from Bank of America
Merrill Lynch projects 60% of new models launched
over the next four years will be either electric or
hybrid. The report also predicts GM and Ford will surpass
Tesla in U.S. EV sales by mid-decade.
Market Trends and Regulatory
- The J.D. Power 2022 Initial Quality Study found
vehicle quality problems experienced a record-high increase
of 11% compared to results in the 2021 edition.
Infotainment represented 6 of the top 10 consumer concerns in the
study. David Amodeo, director of global automotive at J.D. Power,
noted "In general, initial quality has shown steady
improvement throughout the history of this study, so the decline
this year is disappointing—yet understandable. Automakers
continue to launch vehicles that are more and more technologically
complex in an era in which there have been many shortages of
critical components to support them."[Press release
only, no access to full report]
- Semiconductor lead times averaged 27 weeks in June, compared to 27.1 weeks in May and 27 weeks in April, according to analysis excerpted in Bloomberg. Analysts quoted in Bloomberg also noted "supply constraints are not being felt equally," and certain industries may be vulnerable to oversupply, while the automotive industry is still recovering from shortages.
OEMs/Suppliers
- GM was unable to deliver nearly 100,000 light
vehicles in the second quarter due to shortages of microchips and other parts. Most
recently, GM temporarily stopped production last week at its pickup
plant in Fort Wayne, Indiana, due to the semiconductor
shortage.
- Stellantis will temporarily stop production at its minivan plant in
Windsor, Ontario this week for an unspecified reason. The plant had
its annual summer shutdown last week.
- Ford reported a 31.5% sales increase for June 2022 compared to the same period last year, outperforming the market amid double-digit sales declines experienced by several competing automakers.
Connected/Autonomous Vehicles and Mobility Services
- Nearly three dozen autonomous vehicle developers asked California Governor Gavin Newsom to lift the state's prohibition on testing autonomous semi-trucks and delivery vehicles weighing more than 10,001 pounds on public roads.
Electric Vehicles and Low Emissions Technology
- A new survey from Consumer Reports
found 14% of U.S. respondents would "definitely" buy or
lease an electric-only vehicle, up from 4% in the 2020 edition of
the survey, while 22% would "seriously consider" an EV,
and 35% "might" consider an EV.
- Michigan lawmakers approved $130 million to fund a new center for electric vehicle
technology and workforce development at the University of
Michigan's Ann Arbor campus. The Michigan Electric
Vehicle Center is in the planning stages and construction
details were not provided.
- The Wall Street Journal reports GM has a waiting list of approximately 77,000 for its new GMC Hummer electric pickup truck, and the automaker is producing an estimated 12 per day at its Factory Zero in Detroit.
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