Ford (NYSE: F) shares are flat this year, while the S&P is up 11%. Major rival Toyota’s (NYSE: TM) shares have risen 18% over the period. Ford continues to suffer from the battering it took as its investment in EVs cratered. The Ford family has hurt the company.
No car company bragged more about how it would conquer the EV market than Ford, America’s No.2 manufacturer. It said it would open an EV “mega campus” in Kentucky as part of a massive investment. At the time, the company commented, “Ford’s $7 billion investment is the largest ever manufacturing investment at one time by any automotive manufacturer in the U.S. Part of Ford’s more-than-$30 billion investment in electric vehicles through 2025, this investment supports the company’s longer-term goal to create a sustainable American manufacturing ecosystem.”
Ford’s fortunes took a wrong turn almost immediately. It took its two most iconic brands and put them onto EV platforms. The F-150 vehicle, which had been in the US for 42 years, was rebranded the F-150 Lignithing. The Mustang, Ford’s leading sports car since 1965, was turned into a crossover called the Ford Mach-E. Neither sold more than a few thousand units a month. As US EV demand shrank, sales worsened, and Ford retreated from its hugely ambitious EV plans.
The market for people who wanted cars that were not powered completely by gas engines turned to hybrids. Toyota, criticized for not pursuing EVs aggressively, was the leader in this move. Ford repeatedly says it has a strong EV lineup that sells well. In reality, it made its hybrid move late. The fact it sells EVs today was hardly an excuse.
Ford still relies heavily on gas-powered cars, particularly the F-150. That will need to change radically for its stock price to improve.
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