Ford Motor recently announced its delivery figures for the third quarter in the United States, and there’s a mix of good and bad news for investors. In this period, Ford delivered a total of 500,504 vehicles, which included 20,962 all-electric vehicles and 34,861 hybrids.
The Good News
One positive aspect is the growth in overall volume. Ford’s total deliveries increased by approximately 8% compared to the previous year. Electric vehicle sales experienced a significant boost, rising by about 15%. Moreover, hybrid sales witnessed an even more impressive surge, with a 41% increase when compared to the third quarter of 2022.
Investors Respond to the News
Investors seemed to have anticipated this growth, as Ford’s stock only decreased by 0.4% on the day of the announcement. In comparison, the S&P 500 experienced a minor decline of 0.1%, while the Dow Jones Industrial Average dropped by 0.4%. This indicates that investors were not overly concerned by the slight dip in Ford’s stock value.
Ford Outperforms General Motors
Ford’s performance in the third quarter also surpassed that of General Motors (GM). The announcement stated that GM delivered 20,092 all-electric vehicles during this period. Based on this data, it is highly likely that Ford will secure the number two spot in terms of all-electric vehicle sales, behind Tesla (TSLA), once complete figures become available.
The Challenge Posed by Tesla
However, there is some negative news for Ford and GM. Despite their progress, they still lag far behind Tesla in the electric vehicle market. It is estimated that Tesla sold around 100,000 units of its Model Y in the US during the third quarter, while Ford’s Mustang Mach-E achieved sales of about 15,000 units. Thus, traditional automakers like Ford have yet to produce a model that can match the popularity and demand of a Tesla vehicle.
Ford’s Struggle with F-150 Lightning Production
Another challenge Ford is currently facing is the successful ramping up of production for its F-150 Lightning electric truck. Despite resolving some manufacturing issues, Ford’s delivery of Lightning trucks in the third quarter dropped by 46% compared to the previous year, with only 3,503 units delivered.
Focus on Electric Vehicles
While electric vehicle sales are crucial for Ford’s long-term success, they are somewhat overshadowed by the ongoing United Auto Workers strike, which began on September 15. Approximately 8,000 workers, constituting roughly 14% of Ford’s UAW labor force, are currently on strike. Consequently, investors are primarily focused on the outcome of the labor dispute rather than sales figures at the moment.
Ford’s Offer to the Union
Ford recently made its seventh offer to the United Auto Workers union. The proposal includes wage increases, the elimination of specific job tiers that limit wage rates for newer employees, enhanced retirement benefits, and other benefits. However, only time will reveal if this offer will be sufficient to resolve the strike.
Impact on Stock Performance
Since July, when the possibility of a strike began circulating, Ford’s stock has declined by approximately 20%. In contrast, the S&P 500 has seen a decline of roughly 5% over the same period. This significant drop in Ford’s stock value underscores the impact of the ongoing labor dispute on investor confidence.