The F-150 Won't Save Ford

From a macro standpoint, last year global car sales declined for the first time since 2009. Based on first half U.S auto sales, the U.S. auto sales are on pace to drop for a second year in a row. According to a Bank of America Merrill Lynch analyst, the U.S. auto industry is heading toward a nearly 30% decrease in sales by 2022.

From a domestic standpoint, in particular Ford, they reported a 5% fall in U.S. auto sales for the third quarter due to declining sales of its passenger cars such as the Taurus sedan and Mustang sports car. For the quarter they sold 580,251 vehicles last quarter, compared with 609,934 automobiles, a year earlier.

And Ford Motor Co.'s F-150 pickup continues to be America's most-popular vehicle choice.

Dearborn, Michigan-based Ford (NYSE: F) announced on Wednesday that it sold 214,176 F-150 trucks in the latest quarter, down 6 percent from a year earlier. For the calendar year, Ford said it's sold 662,574 F-150 pickup trucks, down 2.4 percent from 2018.

Overall, Ford reported that its total vehicle sales fell by nearly 5 percent to 580,251 in the latest quarter compared with a year earlier. Ford's decline was led by a 29.5 percent decline in car sales.

“As planned, this year is a transitional one for Ford as we move from our sedan lineup to an all-new winning portfolio of trucks and SUVs," said Mark LaNeve, Ford vice president, U.S. marketing, sales and service, in a statement.

Source

The F-150 was introduced to Americans in 1948. The F-150 was originally marketed to farmers and business owners. But now in its 13th generation, the F-150 has updated and redesigned over the years that it now caters to a much wider audience such as contractors and even moms transporting the local soccer team around in the extended cab. It’s the reason why the F-150 has been the best selling pickup truck or more than 40 years.

But boy, it’s expensive. The avg. price of one of these suckers is close to $50,000. The F-150 is a straight cash cow for Ford. The truck accounts for about a third of Ford's US sales and made up a good chuck of the $7.5 billion in profits the Fold made in North America in 2018. Some have even gone as far as saying the F-150 lineup is worth more than the entire company.

However, we all have our limits and so does the F-150…it can’t save Ford, I mean just look at this cart.

The fact that price couldn't even make it up to the weekly supply zones should tell you where price is headed next...down to the monthly demand at $5.25.

This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.