3. Ford Motor Company (NYSE:F)
Number of Hedge Fund Holders: 47
Ford Motor Company (NYSE:F) is a well-established car manufacturer with a diverse range of vehicles under the Ford and Lincoln brands. Through its electrification strategy, the company seeks to upgrade key models like the Mustang, F-150, and Transit to electric versions, including the already available Mustang Mach-E and F-150 Lightning.
The company is also expanding its manufacturing capabilities with significant investments, including the Rouge Electric Vehicle Center, as part of its goal to achieve carbon neutrality by 2050. Additionally, it is focusing on improving battery technology, including solid-state batteries.
However, due to increased competition and a decline in global EV sales, Ford (NYSE:F) has reduced its EV operations and is shifting focus to hybrid technology. This strategy allows consumers to transition gradually to new technologies. Ford plans to offer hybrid options across its entire Ford Blue lineup in North America by the end of the decade.
For the third quarter, Ford (NYSE:F) reported a 4% increase in U.S. retail sales, outperforming the overall market, which saw flat sales. Total sales rose by 1%, while the broader industry experienced a 2% decline. The company experienced a 12% increase in EV sales and is the leading hybrid truck seller, which captures 77% of the segment, according to the company.
Sales of the F-150 hybrid jumped by 64%, while Lincoln saw a 26% increase in sales, with the Nautilus achieving its best third-quarter performance since 2007. New Explorer sales rose by 25% following its recent launch.
Ford’s (NYSE:F) electric vehicle sales are up 45% year-to-date, with significant gains from the F-150 Lightning and the E-Transit van. The Ford Pro Intelligence software platform also saw a 30% rise in active subscriptions, now totaling approximately 620,000.
Finally, Ford and Lincoln dealerships provided over 1 million remote service experiences in Q3, a sign of a growing trend in customer convenience. The company’s strategy of offering diverse powertrains appears to resonate well with consumers, which is contributing to its strong sales performance.
One of the company’s biggest growth catalysts is its focus on smaller, more affordable EVs. In our article about best EV stocks under $50 article, we shared the CEO’s comments about its plans. Here is an excerpt from the article:
“The company’s CEO, Jim Farley announced plans to introduce a $30,000 all-electric vehicle in about two and a half years, emphasizing that profitability is a key focus. During the Aspen Ideas Festival held around the last week of June, Farley revealed that this vehicle, developed by a specialized Ford team, is intended to compete with Chinese automakers like BYD and an upcoming entry-level Tesla (NASDAQ:TSLA) model.
Ford (NYSE:F) is prioritizing smaller, more affordable EVs over larger all-electric trucks and SUVs, as Farley believes the latter is unlikely to be profitable due to the high costs of large battery packs. He highlighted the need for a shift in focus to smaller vehicles for both economic and environmental reasons, despite the historical profitability of larger vehicles like the company’s trucks.”
