Toyota Motor Corporation (ADR) (TM), Honda Motor Co Ltd (ADR) (HMC): Ford Motor Company (F)’s Fusion Is a Company Game-Changer

The Fusion’s success has put a dent in Camry sales and has been one reason the Camry is one of only two vehicles in the top 20 rankings to decline in sales this year. Fusion buyers have been thrilled, and oftentimes a happy consumer equals a thriving business, rewarding investors in the process. Here’s why Ford investors are happy regarding the Fusion.

Investing takeaway
The Fusion has been one of the key vehicles in Ford’s attempt to profitably grow market share. It’s worked: Ford’s market share in the U.S. has increased more than that of any other full-line automaker this year. Not only that, but because supply is so limited, dealers aren’t negotiating on price and the Fusion is selling at a $1,176 premium to the industry average and a $2,378 premium to Toyota Motor Corporation (ADR) (NYSE:TM)’s Camry, according to Bloomberg.

Following the supply-and-demand theme, we know that the premium is great, but to maximize profits you need to hit the equilibrium between price and sales. That’s exactly what Ford Motor Company (NYSE:F) is planning to do, starting right now. Ford is investing $555 million into its Flat Rock Assembly plant to bring additional production of the Fusion online. Ford will hire 1,400 new workers and expects production capacity to increase by more than 30% — enabling production of 350,000 units annually. Going forward we’ll probably see transaction prices for the Fusion decline slightly, but Ford’s overall profits from the vehicle will improve.

For investors it goes beyond just maximizing profits, although that’s a huge plus. The Fusion is expanding Ford Motor Company (NYSE:F)’s global footprint, which is years behind crosstown rival General Motors Company (NYSE:GM). The Fusion is going to be key if Ford wants to reach its goal of doubling its market share in the largest and fastest-growing automotive market — China. Fusion is but one of Ford’s recent success stories, and if the trend continues investors are likely to see more than just the 73% rise in share price over the last year.

The article Ford’s Fusion Is a Company Game-Changer originally appeared on Fool.com and is written by Daniel Miller.

Fool contributor Daniel Miller owns shares of Ford and General Motors. The Motley Fool recommends Ford, General Motors, and Starbucks and owns shares of Ford and Starbucks.

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