In 2022, there are similar issues that the automotive industry has been facing throughout 2021. In addition, there are a host of multiple new legal challenges. Unfortunately, the stability of the international supply chain is no longer enjoyed by the industry. Plus, it is not likely to get restored sooner.
The Annual Global Automotive Consumer Study of Deloitte shows the change in automotive expectations of consumers and the growing mobility ecosystem. The trust in an autonomous automobile is hampering and failing to maintain the speed with the investment level of this sector. On the other hand, the interest of the consumers is increasing in electric vehicles.
Also, consumers are waiting for the government to increase the automotive industry regulations as they want a serious oversight of this sector.
As a result, the automotive industry is enduring a mountain of challenges. In this article, we will explore a few of the top legal issues the automotive industry is facing and how they could be mitigated. But before that, let’s see what the industry is facing from the beginning of 2022.
The Situation of the Automotive Industry in 2022
Due to the pandemic, most of the automotive suppliers saw shortages of raw materials, increased costs and other challenges in the supply chain. While suppliers were facing challenges in obtaining raw materials, the cost increased rapidly to keep up with the supply and demand.
Hence, many suppliers had to pay a hefty price that did not get contemplated in their quotations. Plus, in many cases, these weren’t even covered by the supply contracts.
The challenges don’t end here. Automotive suppliers also had to deal with crucial operative and logistical barriers. They had to encounter getting sufficient labour to run their plants at the fullest capacity. Under this difficulty, the automotive industry exchanged a new surge of force majeure declaration of commercial impracticability.
Host of Legal Challenges Encountered by Automotive Supplier Chain
- Tariffs and Various Tax Challenges
There is no place to escape from the news of the mounting protectionist trade war around tariffs by the US government. This trade war has already been an audience of global manufacturing hits this year.
Countries like the UK, Germany, South Korea, US and Japan declined to manufacture over the summer. The figures have risen after the newest circle of tariffs pitched in, impacting on consumer goods worth billions of dollars.
- Environmental Factor
While the risk of tariffs incites short-term volatility, this industry is simultaneously facing another long-term legal issue which is environmental regulation. Lawmakers are bringing fuel efficiency a top priority. They are setting up national standards known as the Corporate Average Fuel Economy (CAFE) to expand the goals of fuel efficiency.
- Entity management in A Complex Regulatory Domain
The automotive industry is likely to set up a subsidiary structure in order to make a difficult supply chain easier to operate. When an industry faces an increased burden of tariffs and regulatory challenges, it is vital to keep entities on top to make everything operate as it should be.
So, to manage these increasingly complex automotive legal concerns, the Tampa truck accident attorney can help you craft specific strategies for any concerned cases.
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