Manufacturing Industry Advisor

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By: Foley & Lardner LLP

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Latest from Manufacturing Industry Advisor

To say that COVID-19 has wrought havoc on automotive supply chains over the last 8-12 months may be an understatement.  With significant portions of their supply chain located in China, automotive suppliers and their customers had to contend with significant challenges even before COVID-19 brought automotive manufacturing in the United States to a standstill in March.  Although production has restarted, suppliers must deal with a multi-faceted set of new challenges that are affecting their cost-structure. …
It is quite common in supply chain contracts for the buyer and the seller to have competing interests in negotiating key contractual provisions and protections. Before COVID-19, force majeure provisions were often just an afterthought in contract negotiations, with very little difference regardless of whether the manufacturing company was on the buy- or sell-side of the contract and without regard to the specifics in the supply relationship. Instead, manufacturers would copy the same, tired force…
The United States-Mexico-Canada Agreement (USMCA) entered into force July 1, 2020.  You likely have heard that, depending on your company specifics, the Agreement would greatly affect -or not- the way you currently do business among the United States, Mexico and Canada; and now you are obliged to fully comply with it …   USMCA´s provisions –including the agreement, country-specific rules, and related instructions– are spread through thousands of pages but, fortunately, not all of them are…
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Six months after the onset of the coronavirus pandemic, many merger and acquisition transactions remain delayed or sidelined. As companies report their Q2 financial results, investors are also focused on opportunities to acquire promising businesses that may face near-term financial and operational challenges, at lower valuations than were available prior to the pandemic. While these deals may appear to be hard to come by, shrewd investors will be well served by considering both out-of-court and…
Proposed bipartisan legislation would grant authority to the U.S. Customs and Border Patrol (CBP) to seize goods that infringe U.S. design patents, which protect the ornamental appearance of articles of manufacture. CBP already has authority to seize products that infringe trademarks and copyrights, but no authority in relation to design patents. The legislation, introduced by Sens. Thom Tillis (R-NC), Chris Coons (D-DE), Bill Cassidy (R-LA), and Mazie Hirono (D-HI) as “The Counterfeit Goods Seizure …
Manufacturers often find it necessary to schedule temporary plant shutdowns during the year for maintenance purposes or new model changeovers, and require employees to use their vacation during this time. Given that many of our manufacturing clients, especially in the automotive sector, operate in the Midwest, we wanted to survey the state laws in a few Midwestern states.  While forcing employees to use vacation is generally permitted in several Midwestern states, employers may be surprised…
A recent Law360 article by Foley attorneys Gregory Husisian and Jenlain Scott underscores the importance of supply chain due diligence.  As developed in detail here, the risks of large penalties for international regulation violations pose outsized risks for the automotive industry, where many companies source, operate or sell internationally. Also of particular concern to automotive companies is the heightened enforcement of U.S. Customs and Border Protection requirements. For automotive and other manufacturing companies, which…
With the economic disruption of the COVID-19 pandemic certain to continue through the end of 2020, now is the time to consider the impact of the virus on year-end reporting obligations, particularly those that relate to existing economic development credit and incentive agreements. Most credit and incentive agreements contain company obligations for employment levels, taxable revenue, and/or capital investment that may have been impacted by a variety of pandemic-related factors including: stay at home orders,…
Decorated lead automotive analyst John Murphy at Bank of America Merrill Lynch recently unveiled the 2020 edition of his much anticipated “Car Wars” report.  The premise of Car Wars is simple:  for automakers, a faster product replacement rate leads to a fresher overall showroom age which drives market share, profitability and ultimately share price.  Murphy shared 20 years of historical data that support this thesis.  That is, auto companies that can execute (well) on a…
USMCA´s much expected “Uniform Regulations,” which will be binding in all three member countries, were finally issued on June 3, 2020, less than a month ahead of the July 1, 2020 entry into force of the Trade Agreement replacing NAFTA. The Uniform Regulations help interpret, apply and administer several USMCA´s Chapters, namely 4 (Rules of Origin), 5 (Origin Procedures), 6 (Textiles and Apparel Goods), and 7 (Customs Administration and Trade Facilitation). The regulations are voluminous.…