Foley Weekly Automotive Report – October 2021 – 3 | Foley & Lardner srl

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

Key developments

  • IHS Markit lowered its forecast for global light vehicle production to 74.8 million units in 2021, which is a decrease of 1.3% from a major revision released in September. The production forecast for 2022 is slightly revised upwards by 0.1% to 82.7 million units.
  • New vehicle inventory in the United States fell below one million units in September, representing 30 days of industry-wide supply. This is a decrease of 63% from the same period a year ago.
  • New vehicles reached a average transaction price of $ 45,031 in September, up 12.1% from the same period a year ago.
  • Toyota will cut global auto production by 15% in November, amid persistent parts shortages. Toyota has maintained an annual production target of 9 million vehicles for the period ending March 31, 2022.
  • GM, Ford and Stellantis will require COVID-19 vaccination for Canadian employees, contractors and visitors starting later this year.
  • The United States will lift restrictions on its land borders with Canada and Mexico for fully vaccinated foreign nationals beginning of November.
  • New analysis of AAA found that moderate to heavy rains significantly reduced the performance of various types of advanced driver assistance technology.
  • Electric vehicles and low emission technology:
    • A new report from the Alliance for Automotive Innovation estimates that more than 168,000 zero emission vehicles (ZEVs) were sold in the second quarter of 2021, representing 3.8% of the American market.
    • Toyota plans to invest $ 1.29 billion to build a Battery factory in the United States which will begin operations in 2025. The location has not been disclosed.
    • Stellantis and LG energy solution will form a joint venture to produce battery cells and modules for North America, with the intention of starting production in 2024.
    • GM and LG Electronics has reached an agreement for the supplier to cover the majority of the costs associated with the Chevrolet Bolt recall due to the risk of battery fire.
    • Last mile electrical solutions announced an agreement to supply batteries until 2025 with China Contemporary Amperex Technology Co.
    • A new report from Michigan Council on Future Mobility and Electrification urges the state to invest in the mobility sector and to “become more respectful of electric vehicles and better prepared for electric vehicles”.

Market trends and regulation

  • Sales of passenger vehicles in China fell 13% in the third quarter, compared to the same period a year ago, due to the impact of supply chain disruptions. DGsales of in China fell 19% in the quarter, while Ford‘s fell 8.7%, year over year.
  • US retail sales of Medium commercial vehicles classes 4-7 decreased 1.9% in September compared to the same period last year.
  • The National Road Safety Administration requested information about Tesla’s driver assistance software compared to a recent emergency light detection update in September. The agency also intends to review nondisclosure agreements signed by those with early access to Tesla’s city driving function.
  • More than 100 U.S. lawmakers have urged President Nancy Pelosi to maintain consumer tax incentives for electric vehicles built by unions in the $ 3.5 trillion spending program that is making its way to Congress.
  • Michigan Governor Gretchen Whitmer signed a bill allowing state car dealers to adjust hours in an effort to improve flexibility.
  • Producer price for goods and services on final demand increased by 8.6% in the last twelve months on an unadjusted basis, according to the most recent report of the Bureau of Labor Statistics. This is the largest increase since the introduction of the 12-month data series in November 2010.
  • Supply chain bottlenecks and high inflation should impact the US economy “until 2022», According to a recent survey of economists conducted by The Wall Street Journal.

OEM / suppliers

  • Impact on production of the semiconductor shortage
    • Stellantis will reduce its Windsor, Ontario Minivan Plant from two teams to one from spring 2022, citing the effects of the current semiconductor shortage and the COVID-19 pandemic.
    • DG extend production downtime for the Chevrolet Equinox SUV to Ramos Assembly in Mexico until November 22.
  • Ford suspended production for several days last week at its Hermosillo factory in Mexico due to an unspecified parts shortage.
  • Robots Powered by artificial intelligence will ultimately be able to do the majority of the work at Nissan“Smart factory” near Tokyo.
  • Hyundai intends to develop its own semiconductors, and noted that its parts subsidiary Hyundai mobis will play an important role in the internal development plan.
  • Volvo hopes to raise $ 2.9 billion in an initial public offering in Stockholm, with the proceeds intended to help the automaker transition to a direct-to-consumer sales and subscription model.

Connected / autonomous vehicles and mobility services

Electric vehicles and low emission technology

  • Honda announced that all of its new models introduced in China will be electrified after 2030.
  • DG will extend the shutdown of production of Chevrolet Bolt from two weeks to his Orion assembly plant in Michigan, due to a battery pack shortage related to the vehicle’s recall.
  • Last mile electrical solutions announced the opening of a Urban mobility laboratory in San Francisco, which will function as a hub for innovative electric vehicle fleet solutions.
  • Tata Engines will invest more than $ 2 billion in electric vehicle production over the next five years, following an investment from private equity firm TPG.
  • Battery Starter based in Novi, Michigan Our next energy (ONE), raised $ 25 million in Series A venture capital round led by Bill Gates Revolutionary energy companies.
  • American battery solutions will expand its Lake Orion, Michigan Innovation Center from 40,000 square feet to 115,000 square feet, and add 75 positions. The expansion results from “several recent customer awards for high voltage battery packs and solutions for light commercial delivery and heavy duty vehicles.”
  • Flatbed transporter PGT Trucking Inc. intends to rent Nikola Tre fuel cell heavy electric vehicles (FCEV), following the satisfactory completion of a Nikola Tre FCEV demonstration program.
  • Vietnam’s VinFast plans to begin deliveries of its VF e35 and e36 electric utility vehicles to the US market late next year.
  • Ford will invest $ 315 million to prepare its transmission plant for Halewood, England to manufacture generator sets for vehicles sold throughout Europe.

Prepared by Julie Dautermann, Competitive Intelligence Analyst

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