Stellantis, still referring to itself as “FCA,” recently issued new global and North American purchasing terms and conditions dated December 2021 (the “NA Terms”). The NA Terms are a rare, dramatic overhaul to an OEM’s standard terms and conditions. After relying on its 2010 terms for over a decade, and some smaller tweaks last year, FCA replaced 2021’s 26‑page set of terms with a 14‑page global set of terms and — for its North American suppliers — a 40-page North American-specific rider. The result is rewritten versions of almost every material aspect of FCA’s terms.
This blog post briefly highlights some of the most important changes contained in the NA Terms. There are many more material changes than are noted below; and our comments are not intended to express any opinion regarding the enforceability or proper legal interpretation of the NA Terms. Given the wide-ranging impact of the NA Terms on FCA’s direct and indirect vendor relationships, suppliers doing business with FCA should contact a Warner Automotive Industry Group attorney to discuss the NA Terms, how they may be material to your business, and how best to mitigate any risks and respond or object to FCA accordingly.
The NA Terms are structured around a “master agreement,” which FCA intends to govern the entire relationship between it and its suppliers. This means, according to FCA, that it can enter into a contract with its suppliers with or without a binding purchase order, and that suppliers are bound to both FCA’s global terms as well as its continent-specific addenda. Here are some of the notable provisions included in the NA Terms:
These provisions and more will no doubt be the focus of supply chain professionals in the coming months and years. Warner’s Automotive Industry Group is experienced in working with suppliers to react to and strategize accordingly. To continue a discussion of how these new terms may affect your organization, please contact Michael Brady, Dan Bonucchi, Adam Ratliff or your Warner Automotive Industry Group attorney.