The value of Ford stock fell significantly during the September 19th, 2022 – September 23rd, 2022 timeframe. Shares closed the week at $12.31, which represented a 16 percent dip, or $2.41 per share drop in value, compared to the prior week’s closing value of $14.72.
Movement & Ranges
By comparison, shares of Ford’s cross-town rival – General Motors Company – dropped by $4.49 per share, or just over 11 percent, during the same timeframe.
Ford made several announcements during the week. In terms of product, it revealed the all-new Ford Transit Custom plug-in and diesel variants, which will be produced in Turkey starting in late 2023. It also announced significant executive changes to its Ford Model e and Ford Blue leadership teams and a reshuffled deck in its supply chain management team. In the lead up to announcing Q3 2022 financial results, the company revealed it is still grappling with significant supply chain complications and is unable to deliver many vehicles currently in its possession. In the same announcement, it disclosed a $1 billion increase in costs related to parts. Finally, the company announced that it broke ground on its Ford BlueOval City complex, which will produce batteries and electric trucks in 2025.
Ford CEO Jim Farley has been steadfastly outlining The Blue Oval’s future since assuming the role in October 2020. The company’s key goals and organizational changes include:
- An expansion and spinoff for Ford’s leading commercial vehicle business with a suite of software services that drive loyalty and recurring revenue streams.
- Offering compelling, uniquely Ford, fully electric vehicles at scale around the world, including the Ford Transit, Ford F-Series, Ford Mustang, SUVs, and Lincoln models.
- An alliance with German automaker Volkswagen.
- Adding more affordable vehicles to Ford’s global lineup, including in North America.
- Increasing the amount of money spent on EV development, to $30 billion through 2025, a metric that changed to $50 billion by 2026 in early March 2022.
- Having Ford Europe transition to zero-emissions vehicles by 2027 and switch completely over to full EVs by 2030. Furthermore, introducing nine all-electric vehicles into the region by 2024, a plan announced in March 2022.
- The launch of Ford Ion Park, a facility designed to facilitate R&D initiatives on battery production.
- An investment in Solid Power, a producer of solid-state batteries.
- BlueOvalSK, a joint venture between Ford and SK Innovation, Ford’s preferred supplier of EV batteries, which will bolster Ford’s EV manufacturing ambitions, specifically at two upcoming facilities expected to come online in 2025.
- Transforming Lincoln into a fully electrified luxury division by 2030.
- A partnership with Google that will transform the company’s manufacturing operations and see future Ford Motor Company vehicles sport Android-powered infotainment systems.
- A shift to a build to order paradigm for retail customers.
- Buyout programs for employees involved in legacy ICE powertrain and platform development and general workforce reductions to cut costs amid the EV pivot.
- Realigning markets according to what’s outlined in the Ford+ plan, which seeks cost reductions in underperforming regions such as South America and India, in addition to reducing overall headcounts via attrition.
- Supporting green initiatives with a comprehensive sustainable financing framework.
- Producing 600,000 EVs per year by 2024, a projected target that includes doubling Ford F-150 Lightning production to 150K units by mid-2023. In March 2022, the company outlined a new timeframe that targets producing 2 million units of EVs by 2026. This targeted production run rates involve an EV battery master plan that incorporates lithium iron phosphate batteries and new deals with EV battery supplier and mining companies for raw materials.
- Working with semiconductor manufacturer GlobalFoundries to secure additional microchips for its vehicles.
- Securing batteries from multiple companies wherever possible.
- Developing Ford Pro as a one-stop shop for commercial fleet management as it relates to fully electric work vehicles.
- Further strengthening its digital and connected services by entering into collaborations with companies like Stripe and ADT for payment systems and vehicle security, respectively.
- The creation of Ford Blue and Ford Model e, two divisions tasked with gasoline and fully electric vehicle development, respectively.
- Reconfiguring existing plants to prepare for new models and for electrification, with the latest announcement involving the modernization of three American assembly facilities.
The Ford F-150 Lightning officially launched on April 26th, 2022 and is currently at the tail end of its production run. The 2023 Ford F-150 Lightning will arrive in fall 2022 with higher pricing and slightly more range. Additionally, the Maverick is currently in the middle of its initial rollout and sales have steadily increased each month it has been on the market. The compact pickup was named the 2022 North American Truck of the Year in January. The Blue Oval stopped taking orders for the pickup in January in order to focus on building customer orders. 2023 Ford Maverick orders will open in September.
The Bronco family is also steadily rolling out to dealers and both vehicles remain hot ticket items. Ford sold over 100,000 units of the 2021 Ford Bronco Sport last year and just under 40,000 units of the 2021 Ford Bronco during the same timeframe. The Ford Bronco was named the 2022 North American SUV of the Year in January. For 2022, the Bronco range will add the Bronco Raptor and Bronco Everglades variants to its lineup. For 2023, the Bronco family adds the Heritage edition trims to their respective lineups.
Ford is also currently working on ramping up production of the Ford Mustang Mach-E – a four-door, crossover-like hatch inspired by the legendary Mustang pony car. More than anything else, the Mustang Mach-E demonstrates that Ford isn’t afraid to redefine legendary nameplates, and recreate them in new body styles and as new vehicle types.
Production of the Mach-E kicked off in late October 2020, and the model has since found a following within its home market, although sales are held back due to production constraints. Ford delivered its first three examples in December 2020 and 6,614 units in Q1 2021. Since then, the electric crossover has made steady inroads into the Scandinavian EV market, and recently became Norway’s best-selling vehicle in May and July . Automotive outlets and industry experts praised the EV for its good looks, engaging driving dynamics, upscale interior, and clever engineering. Additionally, preliminary reports suggest that the vehicle is already eating into Tesla’s market share, which would be a significant achievement, especially when considering the relatively short amount of time the Mach-E has been on the market. In June, the Mustang Mach-E outsold its gasoline-powered counterpart for the first time. The Mustang Mach-E notched another victory for itself in early July, when Car And Driver named the crossover its 2021 EV of the Year. It also is the most considered compact SUV in the 2021 J.D. Power APEAL study and is currently being considered for police duty in the U.S. and the U.K. The Chinese rollout officially began in late October 2021, when the first domestically produced Mach-E rolled off the assembly line. Ford stopped taking orders for all Mach-E variants in spring 2022 due to high demand, although the company is currently working to boost output to 200,000 units annually by 2024. For 2023, the Mach-E gets higher prices as a result of raw materials becoming more expensive.
The Ford Mustang Mach-E represents one part of a multi-faceted blade Ford hopes will increase its North American market share this year and beyond, as the company has essentially fully transitioned away from sedans and passenger vehicles towards utility vehicles, trucks, and electrified models. That said, all of the aforementioned models have a significant amount of potential to resonate with car shoppers, and their reception will almost certainly continue impact the value of Ford stock, although supply chain issues and factors outside of The Blue Oval’s control appear to be guiding its valuation at the moment.
The Blue Oval has been disproportionately impacted by the ongoing chip shortage, which is expected to continue through at least the first half of 2022, if not longer. Ford CEO Jim Farley believes the shortage will persist through 2023. Pandemic related supply chains woes and the Russian invasion of the Ukraine, which also caused supply chain issues, undoubtedly contributed to the value of Ford stock dropping as well. Additionally, the stock market contracted after the Federal Reserve indicated it would once again increase interest rates this year to combat inflation.
Outside of North America, Ford faces substantial challenges. India and South America continue to take a heavy toll on the company’s financial well-being. Ford Credit is currently winding down operations in both regions, and the automaker has been forced to spend a considerable amount of cash in South America as it begins to shutter several of its assembly plants in Brazil. Ford officially announced its intention to shutter two assembly plants in India in September 2021 after noting that it had lost $2 billion in the country over the past 10 years.
Ford Stock Value Micro Factors
There have been several high-profile personnel changes at Ford recently. The company has added Steven Crowley and Jon Huntsman, two former political operatives, to its executive roster, and both individuals will be instrumental in tweaking the company’s relationship with the federal government going forward. There has been one major departure from the automaker as well, with Ken Washington recently announcing his intention to work for online retailer Amazon. However, Ford recently poached an Amazon executive away from the company, in an interesting turn of events. Another recent personnel involved the hiring of Doug Power, who has been named vice president of corporate development, a newly created position. In January 2022, The Blue Oval recruited Martin Sander to join Ford Europe as head of its passenger vehicle division, which represented another minor coup of sorts, as he came from Audi. Alan Clarke, a prominent Tesla engineer, joined Ford in January 2021.
Stock Performance Year-To-Date
Ford share values have fluctuated substantially since the first day of trading in January 2022, dropping 42 percent, or $8.96 per share, as of this writing. The supply chain crisis, microchip shortage, and macroeconomic concerns about the state of the U.S. economy has clearly rattled investors, which in turn has impacted the value of Ford stock, despite the company’s best efforts to be transparent about its future plans.