Ford Motor Company is seeing sun through the clouds. The Detroit-based automaker's sales momentum was strong in the first half of 2023, despite the company's stock being worth about one-third the price of a share of General Motors (GM).
One year ago, Ford's New York Stock Exchange-listed stock closed (adjusted) at $10.07 per share. Yesterday, ahead of the earnings report, stock closed (adjusted) at $14.94, its highest point since August 2022.
Ford has reason to be optimistic. The company finished June on a streak, having led the way as America's top brand for six straight months. Overall, sales were up 11.2 percent in the second quarter.
The company built that strength on the back of its pickups, vans and commercial vehicles, with second-quarter sales of F-Series trucks up 34 percent (up 27.9 percent overall in the first part of 2023), besting Chevrolet's Silverado, its closest rival, by 118,000 units. F-Series market share has risen to nearly 36 percent, up five points from where it was a year ago.
Ford also outsold all GM brands in the pickup truck category thanks to strong showings from F-Series, Ranger and Maverick. Additional Maverick production capacity will come online in July at the company's plant in Mexico.
Electric vehicle (EV) purchasing is strong due to improved production opportunity, up 11.9 percent year-to-date and 35.5 percent in June alone. Americans are buying the company's Mustang Mach-E electric crossover at a very high rate, up 110 percent in June versus June 2022.
Still, Mach-E sales pale in comparison to Tesla Model 3/Model Y sales, which hit 170,000 deliveries in Q2 alone. GM's closest rival to the Mustang Mach-E, the Bolt EV, has had a sales boom in 2023, reaching 33,658 sales. Bolt production ends near the end of this year.
F-150 Lightning purchases are up 119 percent in Q2 versus 2022 as the company ramps back to full capability following a manufacturing stop due to a battery fire.
Winning with F-150 Lightning isn't just about overall sales. The truck is introducing new customers to Ford with 50 percent of its clients new to the brand based on the company's recent conquest data.
Commercial vehicle buys are also a strong point for the company. Sales of Super Duty pickup and chassis cabs were up 34 percent in Q2, up 24.7 percent in the first quarter. A new version of the truck went on sale during that time.
"Ford's truck sales remain the key profit driver, infused by a new Super Duty. Expect Maverick sales to continue to climb as more production capacity bolsters supply. The new Ranger is coming in late summer, a critical launch for Ford to execute smoothly," Paul Waatti, manager of industry analysis at AutoPacific told Newsweek.
"Ford has struggled with low supply for its EVs, though that situation is brightening. Mustang Mach-E supply has been tight but recent renovations at its plant have opened up increased production volumes that will help meet strong demand. The same goes for F-150 Lightning; deliveries are ticking up, but we expect an even healthier supply in the year's second half."
Ford Motor Company's premium arm, Lincoln Motor Company, has seen sales gains in Q2 associated with additional inventory becoming available. Navigator sales jumped 20.1 percent in Q2 and Corsair sales were up 27 percent in June. Nautilus sales rose 58.5 percent in June ahead of the company's launch of the redesigned model.
"We are going into the second half of the year with one of our strongest and freshest lineups ever. We have an all-new Super Duty, Mustang, Escape and are adding capacity for our hottest products which include Maverick, Bronco Sport, and our EV lineup. We will have improved flow of Bronco to meet continued strong demand for the SUV, along with the all-new Raptor Bronco variant," Erich Merkle, Ford U.S. sales analyst, told Newsweek.
While Ford has already shown most of its hand, buyers will have plenty of opportunity to sample rival new products as 2023 progresses.
Ford's crosstown opponent, GM, has a lot on its plate in the second-half of 2023 and into early 2024 to keep shareholders optimistic. The automaker plans to launch a number of new SUVs and trucks including the new Chevrolet Equinox EV, Blazer EV and Silverado EV and GMC Sierra EV and next-generation Acadia.
Stellantis has a quieter year planned, but has electrification at the forefront of its strategy plans for upcoming models.
Toyota is perhaps the busiest automaker this year, launching the Toyota Grand Highlander, Toyota Land Cruiser, Toyota Tacoma, Lexus RZ, Lexus GX and Lexus TX. There are also plans to announce refreshes of some product already on sale.
"It's a full plate for the second half with a lot of opportunity to fill customer demand for our newest products across our lineup of Ford Blue, Model E and Ford Pro," Merkle said.
The modern vehicles sales-scape is more dynamic than just having good product available to buy.
"Ford, along with every other manufacturer, must continuously evaluate the profitability of vehicles in various configurations across different regions and align their manufacturing and distribution strategies accordingly," Tony Salerno, vice president at J.D. Power told Newsweek.
"While this may seem like an overtly obvious approach, the execution is more difficult now as the industry is undergoing a significant transformation, transitioning from a time where selling all vehicles produced at or above MSRP was the norm, to a new cycle of increased supply and heightened price competitiveness.
"When you factor in the emergence of electric vehicle launches, government subsidies, elevated interest rates, and the asymmetry of fuel prices, the terrain becomes vastly different from the pre-pandemic era. Therefore, Ford's ability to outperform competitors in terms of build mix, distribution efficiency, and pricing optimization will ultimately determine their success with both consumers and shareholders."
