As Ford Authority reported earlier today, FoMoCo currently has around 40,000-45,000 unfinished vehicles sitting at its plants awaiting supply constrained parts, which is part of the reason why the automaker’s new vehicle inventory has plummeted ahead of an expected ramp up in Q4. At the same time, The Blue Oval also revealed that its inflation-related supplier costs rose significantly during Q3, to the tune of $1 billion more than originally expected. Those revelations have had a major impact not only on the automaker and its customers, but also on Ford stock, which took a large hit on Wall Street today, according to Reuters.
Ford stock sunk 11 percent on Tuesday following the company’s announcement, hitting $13.33 as it was on track for its sharpest single-day decline since the onset of the COVID-19 pandemic in March 2020. This follows Ford’s announcement in July that it expects its commodity costs to rise by $4 billion this year, as well as preliminary Q3 results that show automakers will likely take longer to recover from the chip shortage than previously expected.
Through the entirety of 2022, Ford stock is down 36 percent following a strong run in 2021 that culminated with a share price of $21.27 in January of 2022. Since then, the automaker’s stock has been on a bit of a roller coaster ride with each passing month, landing at $15.10 on the first of this month after hitting a low of $11.10 at the beginning of July.
Aside from the chip shortage and other supply chain constraints, Ford is also dealing with major inflation issues, which have increased its costs exponentially. Meanwhile, the Federal Reserve is once again expected to raise interest rates in an effort to calm inflation – as much as 75 basis points this month, in fact – though investors remain concerned that these efforts could hamper economic growth as well.