Industrials Regulatory News and Trends - February 7, 2025

Welcome to Industrials Regulatory News and Trends. In this regular bulletin, DLA Piper lawyers provide concise updates on key developments in the industrials sector to help you navigate the ever-changing business, legal, and regulatory landscape.

New acting FAA head. On January 30, Chris Rocheleau, an Air Force veteran who worked at the FAA for more than 20 years, was named acting head of the Federal Aviation Administration. Rocheleau previously was the chief operating officer of the National Business Aviation Association. Among the priorities listed by that association are air safety and security, as well as FAA reauthorization and modernization. NBAA also highlights the need to minimize the aviation industry's environmental impact. The choice of Rochelau received good reviews from the US airline industry. “Chris’s proven, solid experience will provide smart leadership at this vital agency, especially during this critical time for our country,” Nicholas Calio, president of Airlines for America, said in a statement. 

US auto and transportation policy at an inflection point: A tale of two transportation trajectories? January 2025 – including the first 10 days of Donald Trump’s second term as President of the United States – likely marks the beginning of substantial changes in federal transportation law and regulation, including a number of potentially disruptive changes to regulation of the motor vehicle industry and related funding and incentives. As detailed in this alert, the new Administration’s ambitious agenda of new policies and regulatory approaches could have significant implications for transportation industries and the businesses and customers they serve – ie, most Americans.

Order prioritizes federal transportation funding for communities with higher-than-average marriage and birth rates to mitigate impacts of DOT programs, policies, and activities on families and family-specific difficulties. Shortly after being sworn into office on January 29, 2025, the United States Department of Transportation (DOT) Secretary Sean Duffy issued a series of orders intended “to rescind woke policies, roll back burdensome and costly regulations, restore economic growth” and ensure the department is in alignment with the new Administration’s priorities. One of those Orders directs the DOT, to the extent practicable, relevant, appropriate, and consistent with law, to “give preference to communities with marriage and birth rates higher than the national average” when awarding federal contracts, loans, grants, or assistance. The stated purpose of this directive is to mitigate the unique impacts of DOT programs, policies, and activities on families and family-specific difficulties, such as the accessibility of transportation to families with young children. The Order also states that statutes governing DOT policies, programs, and activities shall be administered to maximize benefits for families and communities by, among the many intended benefits, “improving the quality of their lives, raising their standard of living, or enabling them to participate more fully in our economy.” The same undated Order prohibits recipients of DOT support or assistance from “imposing vaccine or mask mandates.” That Order further directs DOT operating administrations and offices to implement these directives “to the maximum extent permitted by law.”

Court clears the way for lithium extraction project in California. A California court has cleared the way for the Hells’ Kitchen I project, the first of several projected facilities alongside the Salton Sea, which aims to build a geothermal power plant and extract the critical mineral lithium from massive underground brine reserves. The plant would generate about 40 MW of steam power, separate raw lithium out of the waste stream, and produce an expected 25,000 metric tons of commercial-grade lithium hydroxide each year. The developer, Controlled Thermal Resources (CTR), also plans to build six additional lithium extraction and geothermal power plants in the vicinity. The lawsuit, brought by local nonprofit Comite Civico del Valle and environmental organization Earthworks, charged that environmental review for Hell’s Kitchen I was inadequate and that CTR had not consulted with local Native American Tribes as required by law. The court, however, found that the environmental reviews were proper and that appropriate consultations had taken place. Construction, which was halted as the lawsuit moved forward, is now projected to resume within several months.

Federal appeals court vacates FTC regulation governing auto dealer sales practices. Ruling that the Federal Trade Commission failed to follow notice-and-comment procedures mandated by the FTC Act, on January 27 the US Court of Appeals for the Fifth Circuit vacated the Combating Auto Retail Scams (CARS) Trade Regulation Rule, sometimes called the Vehicle Shopping Rule. That Rule, promulgated during the Biden Administration, aimed to address US auto sales practices (including hidden “junk fees”) perceived as deceptive or misleading. The panel of judges ruled 2-1 in favor of the auto dealer petitioners, holding that the FTC violated its own regulations by failing to issue an advance notice of proposed rulemaking before promulgating the rule. The CARS Rule had been on hold pending the legal challenge. The case is National Automobile Dealers Association and Texas Automobile Dealers Association v. Federal Trade Commission.

Senators introduce new bill to strengthen manufacturing supply chains. On January 27, a bipartisan group of US senators reintroduced a bill to strengthen supply chains for US manufacturers. The Promoting Resilient Supply Chains Act, introduced by Senators Maria Cantwell (D-WA), Marsha Blackburn (R-TN), and Lisa Blunt Rochester (D-DE), aims to enlist both the government and the private sector to prevent future supply-chain disruptions. The senators noted that geopolitical tensions, natural disasters, and the COVID pandemic have exposed weaknesses in US supply chains and that the nation is too heavily reliant on individual foreign countries for key minerals and pharmaceutical ingredients.

Kia announces recall of vehicles because of a wiring-related defect. Kia America this month initiated a recall of more than 80,000 model years 2023-2025 Niro vehicles due to a wiring defect, according to a report the auto manufacturer filed with the National Highway Traffic Safety Administration. The recall covers the company's Niro EV, plug-in hybrid, and hybrid crossover SUVs for the affected model years, targeting a floor wiring defect that could potentially affect the operation of airbags and seat belts.

Our coverage of business-relevant Executive Orders and Actions. DLA Piper’s President Trump Executive Orders hub compiles business-relevant Executive Orders and Executive Actions signed by President Donald Trump as well as our coverage and insights on those moves. Among this week’s DLA Piper alerts are “America First Trade Policy”: President Trump orders review ahead of potential tariffs on China and other trading partners; President Trump’s week-one Executive Orders signal significant changes coming to environmental law; and the weekly White House Executive Orders impacting tax and trade.