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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

  • A Supplier Alert from Foley
    & Lardner
     shared key points involving the
    decision by Stellantis to rescind
    unpopular new purchase order terms and conditions.

  • LMC Automotive estimates U.S. new
    light-vehicle sales 
    reached 4.55 million
    units 
    in the first four months of
    2022
    , representing a decline of 16% from the same period
    in 2021, but up by 8% from 2020.

  • The semiconductor shortage has
    resulted in the loss of nearly
    1.7 million units of global production this year
    ,
    according to AutoForecast Solutions quoted in The Detroit
    News
    .

  • Toyota  indicated high raw
    material costs
     and ongoing semiconductor
    shortages 
    could reduce its next full-year profit by
    roughly 20%, while noting ongoing economic uncertainty made it
    difficult to provide a forecast.

  • Crain’s
    Detroit
     (subscription) reports recent earnings
    results from several major automotive
    suppliers
     reflect the continued impact
    from inflation and production
    volatility
    .

  • U.S. heavy-duty  truck and trailer orders were
    down by double digits in April, resulting from manufacturers
    maintaining tight control over orders amid parts shortages and
    supply chain uncertainty.

  • Ford, GM 
    and Stellantis  plan to reinstate mask
    mandates
     at facilities
    in Michigan counties with high risk for
    COVID-19 transmission.

  • According to a recent blog post by Foley &
    Lardner
    , Mexico’s antitrust commission
    (“COFECE”) has recently fined “companies in the auto
    parts industry more than 9 million Mexican pesos for failing to
    notify two concentrations on time.”

  • Bloomberg reports 
    GM 
    will raise wages by 8.5% at its truck plant in
    Silao, Guanajuato as part of a new labor agreement with union
    SINTTIA. 

  • Electric vehicles and low emissions
    technology
    :

    • The CEOs of automakers including StellantisTesla and Volvo have
      warned component
      shortages
       and higher raw material
      prices
       could present significant risk to
      EV supply chains
      .

    • The U.S. Department of Energy announced a $45
      million program to support domestic production of advanced EV
      batteries. The Electric Vehicles for American
      Low-Carbon Living
       program includes investments to
      create batteries with faster charging times, and improved
      resilience and energy efficiency.

    • Bollinger Motors will
      partner
       with Roush
      Industries
       to manufacture all-electric commercial
      platforms and chassis cabs.

    • The Alliance for Automotive
      Innovation
       released a policy
      framework
       to address the reuse, repurpose and recycling of
      EV battery components.

Market Trends and Regulatory

  • Passenger car sales in China fell by
    35.7% in April compared to the same period one year ago, according
    to estimates from
    the China Passenger Car Association.

  • The Wall Street
    Journal
     reports record-high diesel
    prices
     are straining operational costs for trucking
    companies and exacerbating high transportation costs throughout
    supply chains.

OEMs/Suppliers

  • Due to the semiconductor
    shortage, Stellantis and Ford temporarily idled
    production
     last week at plants in Illinois, Kentucky and
    Ontario.  Affected models included the Jeep Cherokee, Ford
    Escape, Ford Edge, Lincoln Corsair and Lincoln Nautilus.

  • Stellantis temporarily halted
    production
     at its minivan plant in Windsor, Ontario last
    week due to an unspecified parts
    shortage
     that was not related to
    semiconductors.

  • Toyota will
    reduce
     production at 12 plants in Japan for up to six days
    in May due to the impact of COVID-19 lockdowns in
    China
    , and global production targets were reduced by
    approximately 50,000 vehicles.

  • GM announced a
    partnership with INRIX Inc. to provide safety
    solutions data to the U.S. Department of
    Transportation
     through analytics from a cloud-based
    application called Safety View by GM Future Roads &
    Inrix.

  • Toyota will
    use
     computer vision technology from Austin, Texas-based
    startup Invisible AI in its North
    American assembly plants to process body motion data for the
    purpose of enhancing safety, quality and efficiency.

Connected/Autonomous Vehicles and Mobility Services

  • Magna announced new
    advanced driver assistance systems (ADAS) for the 2022
    Toyota Tundra
     in the North American market, including
    a “complete surround view system” that provides a
    “fly-around 3D image of the vehicle and its environment upon
    startup.”

  • Aurora Innovation announced a
    collaboration with long-haul trucking carrier Covenant
    Logistics
     to “explore the integration and
    deployment” of Aurora’s autonomous trucking product.

  • GM announced a
    partnership with open-source software solutions
    provider Red Hat to expand
    software-defined vehicle programs, including the automaker’s
    upcoming Ultifi platform.

  • Volvo Autonomous Solutions  will
    partner
     with DHL Supply
    Chain
     to pilot a new “hub-to-hub transport
    solution” in North America.

  • Stellantis’ car-sharing mobility
    unit Free2move will
    acquire
     Share Now from the BMW and
    Mercedes-Benz groups, which adds service offerings in 14 European
    cities and 10,000 vehicles to Free2move’s existing fleet of
    2,500 vehicles.

Electric Vehicles and Low Emissions Technology

  • Battery maker Contemporary Amperex Technology Co.
    (CATL)
     is vetting potential U.S. sites for a new
    manufacturing facility, according to unconfirmed reports in Reuters.

  • Wood Mackenzie predicts there
    will be a significant U.S. market for heavy-duty
    vehicle electrification. 
    However, this segment will
    likely experience a slower ramp-up due to market barriers including
    lack of model availability, as well as battery capacity
    concerns.  [Summary only, full report not publicly
    available
    ]

  • Software vulnerabilities could expose EV charging
    stations
     as a potential target
    for hackers, according to a recent report
    in Automotive
    News
    .

  • Foxconn completed a
    $230 million transaction to acquire Lordstown
    Motors’
     Ohio factory, and the site will become a
    joint venture between the two companies to produce electric pickup
    trucks.

  • Subaru  will
    invest
     $1.9 billion on EV battery capacity over the next
    five years as part of a broader investment in
    electrification.

  • Nissan indicated it
    may add a third U.S. plant by the end of the decade, citing the
    importance of production localization as well as the potential need
    to meet future EV demand.  The automaker currently has U.S.
    manufacturing facilities in Canton, Mississippi and Smyrna,
    Tennessee.

Analysis 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.

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Foley Automotive Report

Foley & Lardner

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.

Foley Automotive Report

Foley & Lardner

This report helps automotive suppliers inform their legal and operational decisions to help address challenges and opportunities.

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