Foley Automotive Update

Analysis by Julie Dautermann, Competitive Intelligence Analyst

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Key Developments

• Foley & Lardner announced the 2024 installment of its Auto Trends series—A Year in Review: Updates, Trends and the Road Ahead. This series delves deep into the transformative forces shaping the automotive world by providing weekly insights and analysis tailored to help business leaders navigate a shifting market landscape. The most recent article in the series assessed the impact of the Michigan Supreme Court case MSSC, Inc. v. Airboss Flexible Products Co. on the auto industry and the direction of the law of requirements contracts and the Statute of Frauds. Click HERE to subscribe to updates.
• Full-year 2024 U.S. new light-vehicle sales reached a SAAR of 15.9 million units, up 2% from 2023, due to a strong fourth quarter, higher inventory, increased vehicle incentives, and robust sales of pickup trucks and hybrid vehicles.
• Cox Automotive estimates a record-high 1.3 million EVs were sold in the U.S. last year, representing 8% of 2024 new-vehicle sales. Strong fourth quarter sales volumes were attributed to consumers motivated by EV tax incentives that could be discontinued in the months ahead.
• S&P Global Mobility expects 2025 U.S. new light-vehicle sales of 16.2 million units, noting the industry’s growth could be affected by ongoing vehicle affordability issues and “sticky” inflation levels.
• First-half 2025 auto lease maturities could decline by up to 41% compared to first-half 2024, representing a sales loss of nearly 1 million units. The decline is attributed to lower volumes of projected 36-month lease maturities and a higher prevalence of longer-term loans.
• President-elect Donald Trump disputed a Washington Post report that suggested his administration could apply new tariffs only to certain critical imports.
• Ford, GM and Toyota will each donate $1 million to President-elect Trump’s inauguration, and Ford and GM will contribute vehicles to support the event.
• Automotive News provided a summary of reactions from Canadian auto executives following the announcement Prime Minister Justin Trudeau will resign in March 2025.
• Tesla delivered 1.79 million battery-electric vehicles globally in 2024.
• BYD sold 4.27 million plug-in hybrid and battery-electric vehicles worldwide in 2024. Within this amount, 2.48 million units were hybrids and 1.76 million units were BEVs.
• The International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) resumed negotiations this week amid the potential for strikes at U.S. East and Gulf Coast ports due to a contract set to expire on January 15, 2025.
• The Alliance for Automotive Innovation expressed support for a National Highway Traffic Safety Administration proposal to establish a voluntary national framework for the oversight of certain vehicles equipped with automated driving systems. The ADS-equipped Vehicle Safety, Transparency, and Evaluation Program (AV STEP) could also help to streamline reviews of exemptions filed by automakers hoping to deploy self-driving vehicles without certain required human controls.

OEMs/Suppliers  

• A number of major automakers reported higher U.S. sales in 2024:
  • GM was the top-selling automaker in the U.S., with volumes of 2.7 million units, representing a 4% increase from 2023.
  • Toyota’s sales rose 3.7% YOY to 2.3 million units. 
  • Ford’s sales increased 4% YOY to 2 million units.
  • Honda’s sales were up 8.8% YOY to 1.4 million units.
  • Hyundai’s sales rose 4% YOY to over 836,000 units.
• Stellantis reported its 2024 U.S. sales declined by 15% YOY to 1.3 million units.
• Honda and Nissan are pursuing plans to merge their operations and establish a joint holding company that could list on the Tokyo Stock Exchange by August 2026. If the merger proceeds, the combined entity could become the world’s third largest automaker based on sales, behind Volkswagen and market leader Toyota.
• Volkswagen will gradually eliminate up to 25% of its German workforce in a labor agreement that is expected to avoid near-term plant closures.

Electric Vehicles and Low Emissions Technology

• The Defense Department included a leading Chinese battery maker in the annually updated Section 1260H list of companies that operate in the United States and allegedly provide products to support China’s military.
• China is considering new export restrictions on certain technologies used for lithium refining and battery chemicals production.
• Profitability for EV makers in China in 2025 could be affected by a continued price war in the nation, as well as tariffs on vehicle exports to markets that include the European Union. 
• Business and industry leaders shared thoughts on the outlook for U.S. battery projects under the second Trump administration.
• Crain’s Detroit provided an update on the status of battery plant investments in Michigan.
• Efforts to advance sodium-ion batteries could support U.S. goals to establish alternatives to China’s near-dominance of lithium-ion battery supply chains, according to a report in The Wall Street Journal.

Autonomous Technologies and Vehicle Software

• Updates during CES 2025 included:
  • Nvidia projected its automotive revenue will reach $5 billion by fiscal 2026 due to the growing importance of software-defined vehicles.
  • Amazon Web Services (AWS) and HERE Technologies announced a 10-year, $1 billion cloud infrastructure agreement to advance AI-powered mapping and location services for automotive, transportation, logistics and mobility companies worldwide.
  • Qualcomm announced several automotive collaborations to support AI-powered in-cabin features and advanced driver assistance systems (ADAS).
  • Bosch highlighted software-based solutions that included interior sensing features and vehicle motion management.
  • Aptiv showcased its sixth generation ADAS, and AI-enhanced features that included a hands-free driving system, predictive technology and in-cabin personalization.
  • Valeo and AWS will collaborate to develop applications for software-defined vehicles.
• Uber and Lyft plan to offer new app features and infrastructure to support driverless rides from Alphabet’s Waymo and other robotaxi operators in certain U.S. markets this year.
• TuSimple Holdings rebranded to CreateAI, and the company will cease development of autonomous driving technology to focus on AI-enhanced video game content.

Market Trends and Regulatory

• U.S. Steel and Nippon Steel filed lawsuits over the Biden administration’s decision to block a merger between the two companies due to national security risks.
• The California New Car Dealers Association stated that Volkswagen Group and Scout Motors’ intent to sell vehicles directly to consumers violates a section of the state’s law pertaining to new-vehicle sales.
• The California Air Resources Board (CARB) announced Stellantis will pay a $4.2 million penalty after an investigation found certain 2014 through 2016 model year Ram ProMaster vehicles violated the state’s air quality regulations.