Supply Chain Force Majeure

The Michigan Association of Corporate Counsel (ACC) and Foley & Lardner LLP recently presented a virtual webinar, “Looking Forward: Advance Preparation in a Dynamic Legal & Business Landscape.”

Even before COVID-19, companies were considering whether China continued to make sense for their offshore manufacturing operations.

Given that the original epicenter of the coronavirus was the important worldwide manufacturing hub of Wuhan, China, the automotive industry was swiftly and seriously impacted in ways that continue one year later.

The early decreases in production, together with the continuing impact of the pandemic on supply chains and economic activity that has rebounded as the country reopened, has resulted in a potent mix of volatility and increasing prices in the steel market.

A new survey suggests a potentially drastic shift in the way manufacturing executives think about their supply chains: from a primary focus on minimizing lead times and cost to one that prioritizes more stability and resilience in the face of disruption.

The COVID-19 pandemic is causing an uptick in dealer terminations, which can trigger unexpected and costly equipment repurchase obligations. It is important that manufacturers and suppliers keep aware of applicable equipment repurchase requirements.

Managing warranty claims, including both defending such claims and pursuing recovery from responsible sub-suppliers, always has been a critical task for automotive suppliers. This perhaps has never been truer than it is today.

Suppliers have faced unique challenges in keeping their products and services flowing into the marketplace during a pandemic. An overhaul of contract provisions is yet another improvement suppliers can implement to shore up their defenses in case of emergency events.

Manufacturers and suppliers face a struggling dealership sales network as the effects of the coronavirus pandemic continue to ripple across the United States.