Foley Automotive Update

Key Legal Insights from Foley’s Automotive Team

Analysis by Julie Dautermann, Competitive Intelligence Analyst

Foley is here to help you through all aspects of rethinking your long-term business strategies, investments, partnerships, and technology. Contact the authors, your Foley relationship partner, or our Automotive Team to discuss and learn more. 

Key developments

• Foley & Lardner PartnersVanessa MillerandNicholas Ellis,as well asSenior Counsel Robert Okonowski and Associate Leighton Allen, will be among the speakers at MEMA’s Q2 Supplier Industry Briefing: Industry Strategy, Policy & Innovation Outlook to be held May 13, 2026 in Pontiac, Michigan. 

• On April 7, Crain’s Detroit reported that Stellantis and supplier Kamax were seeking to dismiss their lawsuit before the Michigan Supreme Court. The article notes the case outcome could have clarified certain aspects of contract enforceability.
• Foley & Lardner provided an overview of risks supply chain leaders cannot ignore with humanoid robots. Synergies gained from artificial intelligence advancements in autonomous driving development could provide certain automakers with an advantage in deploying AI-powered humanoid robots. 

• The Iran war has disrupted roughly 10% of global shipping container capacity. As a result, volatility and risk along automotive supply chains are increasing in areas including critical components such as “plastics, coatings, battery materials, tires, and semiconductors.”

• The global aluminum market is at risk to be in a full-year deficit, and average aluminum prices reached a four-year high, due to damaged energy infrastructure across the Persian Gulf and shipping constraints in the Strait of Hormuz.
• The Wall Street Journal reported the Trump administration has thus far rejected automakers’ requests for relief from aluminum tariffs, despite supply constraints caused by a supplier’s ongoing production shutdown following two fires last year.
• The Trump administration adjusted certain aspects of how Section 232 import tariffs on steel, aluminum, and copper are calculated regarding the value of articles and derivative articles. The proclamation also referenced products that will no longer be subject to Section 232 metal tariffs if they do not contain any “sufficient” aluminum, steel or copper content.

• The first phase of an electronic system allowing U.S. importers to pursue refunds for International Emergency Economic Powers Act (IEEPA) – based tariffs will launch April 20, according to an update from U.S. Customs and Border Protection (CBP). The CBP stated the Consolidated Administration and Processing of Entries (CAPE) process will be launched in phases, and the first phase will be “limited to certain unliquidated entries and certain entries within 80 days of liquidation.”

• PwC estimated the auto industry could collectively receive IEEPA tariff refunds totaling $19.9 billion. 
• The U.S. Court of International Trade (CIT) discussed the legality of President Trump’s use of Section 122 of the Trade Act of 1974 to replace IEEPA tariffs that were struck down by the U.S. Supreme Court. The judges did not indicate how soon they plan to rule on the duties. The Section 122 tariffs are scheduled to expire July 24, 2026.

• On April 7, U.S. Trade Representative Jamieson Greer suggested that negotiations over the U.S.-Mexico-Canada Agreement (USMCA) may not achieve resolution of all issues by the July 1, 2026 deadline for the U.S. to notify Canada and Mexico about its plans for the trade agreement.

OEMs/SUPPLIERS  

• Lear plans to invest $87 million to establish a new seating plant in Auburn Hills, MI.
• Magna International Inc. announced the sale of its lighting and rooftop systems businesses in three separate transactions to undisclosed buyers, amid efforts by the supplier to prioritize long-term growth and higher margins.

• The Trump administration has pursued preliminary discussions to ask U.S. automakers and manufacturers to increase their capabilities in weapons production, according to unnamed sources in The Wall Street Journal.
• The UAW may next target a Mercedes-Benz plant in Alabama for renewed efforts to unionize, according to a report in WardsAuto. This follows the UAW’s recent ratification of a four-year contract covering over 3,000 workers at Volkswagen of America’s plant in Chattanooga, Tennessee.

MARKET TRENDS AND REGULATORY

• The Amazon Autos car sales platform has expanded to include new vehicles from Kia, Mazda, Subaru, Chevrolet and Jeep. Dealers pay a fee to have their vehicles listed on Amazon.
• The University of Michigan’s Index of Consumer Sentiment fell to 47.6 in April, representing the lowest recorded level in the survey’s history.  
• Average wholesale used-vehicle prices in the U.S. reached the highest level since the summer of 2023, due to robust demand and tight supplies, according to analysis from Cox Automotive. Total used-vehicle sales for full-year 2026 are projected to fall 1% year-over-year.
• The European Commission may revise the Individual Vehicle Approval (IVA) framework to tighten rules that allow large pickup trucks produced by U.S. automakers to be sold in limited numbers in the EU. 

Autonomous Technologies and Vehicle Software

• According to a report from AlixPartners, Chinese automakers are more likely to build in-house capabilities to develop software-defined vehicles (SDVs), while Western automakers are more likely to outsource control of key aspects of SDV architecture and integration. The analysis also notes 94% of all automakers monetize less than half of SDV features, due to obstacles that include technical challenges and customer resistance.
• Automotive News provided an overview of automakers’ subscription options for certain advanced driver assist systems (ADAS) features.
• Bosch and Qualcomm expanded a strategic partnership to include ADAS technology. Bosch has delivered over 10 million cockpit computers to global OEMs using Qualcomm’s Snapdragon system-on-chips.
• Stellantis announced a five-year collaboration with Microsoft to develop advanced AI, cybersecurity and engineering capabilities.

HYBRID AND Electric Vehicles

• First-quarter 2026 new EV sales declined by 27% year-over-year, and EVs represented 5.8% of total U.S. new-vehicle sales in Q1 2026, according to analysis from Cox Automotive.
• Ford’s EV chief will depart the company, amid a broader reorganization that will combine the automaker’s electric vehicle, digital and design unit with its industrial operations.
• The U.S. had nearly 13,500 public, high-speed EV charging stations nationwide as of Q1 2026, representing an increase of 25% YOY.
• Jeff Bezos-backed electric truck startup Slate Auto raised $650 million in a Series C funding round. The startup plans to use the funding to bring a mid-$20,000 electric pickup truck to the U.S. market later this year.
• Volkswagen ended U.S. production of its first mass-market EV, the ID.4. The Chattanooga, TN plant that produced the ID.4 will shift its focus to the 2027 Atlas SUV.
• Chinese EV maker BYD plans to open approximately 20 dealership locations with partners in Canada this year.