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. 

AUTOMOTIVE KEY DEVELOPMENTS

• Mobility Global, formerly S&P Global Mobility, expects 2026 U.S. auto sales will reach 15.82 million units, representing a decline of approximately 3% year-over-year from 2025. The analysis also predicts new light-vehicle sales in July “will maintain pace with the previous three months,”noting that “the market is settling rather than growing.”
• Automotive News provided preliminary estimates for July 2026 new light-vehicle sales.
• Ford followed GM in raising 2026 full-year guidance, amid expectations for continued sales of higher-priced pickups and SUVs. Ford’s second-quarter 2026 sales fell nearly 10% YOY amid recovery from a supplier fire, while EV-related charges drove a $1.3 billion net loss.
• Toyota raised its annual earnings guidance after reporting a 76% YOY increase in net profit for the three months ended June 30, 2026.

• Stellantis reported second-quarter 2026 earnings that missed analyst projections, despite posting a profit in North America for the second consecutive quarter. The automaker maintained its 2026 financial guidance.
• Nissan reported a quarterly net profit of ¥3.8 billion (US$24M) for the three months ended June 30, 2026. The automaker maintained its annual earnings guidance for the fiscal year ending March 2027.
• Chinese brands accounted for 17% of new vehicle sales in Mexico during the first half of 2026, up from 14% a year earlier, according to data from the Mexican Association of Automobile Distributors cited by Reuters. Sales rose to 137,525 in H1 2026 compared to 107,712 during the same period last year.

TRADE/TARIFFS

• Foley & Lardner partner Gregory Husisian garnered media coverage across multiple sources for his analysis of the Trump administration’s announcement of a 50% tariff on Canadian imports.
• The U.S. Department of Commerce will request public comments regarding a proposal to include an additional 14 types of derivative products in its Section 232 tariffs on steel, aluminum and copper, according to a notice that is scheduled to post on August 6, 2026.
• According to a notice from the U.S. Department of Commerce, eligible domestic manufacturers of engines for automobiles and medium- and heavy-duty vehicles (MHDVs) can apply to receive tariff offsets for sectoral duties on imported parts starting July 29, 2026. This follows previous guidelines that established offsets for domestic automobile and MHDV manufacturers for certain imported parts.
• Truck bed covers produced by certain Chinese manufacturers may be subject to triple-digit tariffs due to a preliminary affirmative determination in the Commerce Department’s countervailing duty (CVD) investigation. The Commerce Department expects to make its final CVD determination “on or around October 13, 2026.” The agency is also conducting antidumping duty investigations of truck bed covers from China.
• In a July 28 update to its “covered list,” the Federal Communications Commission banned imports of “advanced robotic devices” – defined as mobile robots, such as humanoids and quadrupeds – as well as connected power inverters, citing concerns for national security.

OEMs/SUPPLIERS  

• Chinese tooling and casting manufacturer Huatai Mould will invest $30 million to establish a new plant in Aguascalientes, Mexico. This will be the company’s first manufacturing facility in the Americas.
• During a recent employee town hall, Ford CEO Jim Farley reportedly warned that Chinese automakers could enter the U.S. market within five to ten years, despite tariffs and trade barriers currently blocking them.
• BMW plans to eliminate up to 8,000 white-collar jobs in Germany by the end of 2027 through a voluntary severance program, due in part to sales losses to Chinese competitors. This follows Volkswagen’s recent announcement that it may cut up to 100,000 jobs across its brands by 2030.
• The Wall Street Journal reported on the opportunities and challenges Ford and GM face as they pursue expansion in defense and grid-scale battery storage markets.

AUTONOMOUS TECHNOLOGIES AND VEHICLE SOFTWARE

• Certain AI-powered systems are expected to accelerate aging in automotive sensors and other electronic components, leading to vehicle security and operational risks. Unlike traditional automotive electronics which operate intermittently, AI is “always on,” contributing to the “gradual decline of hardware within automotive systems.”  
• Zoox received approval from the National Highway Traffic Safety Administration to deploy up to 2,500 commercial robotaxis annually over the next two years. Amazon-owned Zoox has been offering free rides in parts of Las Vegas and San Francisco in a purpose-built autonomous vehicle that does not have pedals or a steering wheel.
• Paccar’s CEO said the parent company of Kenworth and Peterbilt does not have any immediate plans to remove human drivers from the autonomous trucks it is developing with partners.

MARKET TRENDS AND REGULATORY

• Concerns are rising over diesel supplies and prices amid instability in the Middle East and the approach of the high-demand autumn season, according to a report in The Wall Street Journal. The average price of diesel nationwide was $5.36 as of August 3, compared with $3.73 one year ago.
• AI-powered recommendation algorithms are expected to play a growing role in how consumers choose their next vehicle.

HYBRID AND ELECTRIC VEHICLES

• According to data from the California New Car Dealers Association, hybrid EVs reached a record 22.1% market share in the state, with 191,000 registrations in the first half of 2026. Battery EVs achieved a 15.9% market share, with slightly over 137,000 units sold in H1 2026. Total new vehicle sales in California declined 7.7% YOY, with 864,848 new light vehicles registered in the first six months of 2026 compared with 936,543 during the same period in 2025.
• Bloomberg provided an update on the recent actions of big-box retailers in building out EV charging infrastructure across the U.S.
• Rivian raised its full-year 2026 sales guidance to between 65,000 and 70,000 EVs.