Ford Reports Q3 2024 Growth and EV Strategy Advancements Amid Strategic Shifts

Preview
Ford's Q3 2024 earnings report highlights several key points regarding their growth and EV strategy advancements:

Growth Details

  1. Revenue and Sales:
    • Ford's Q3 2024 revenue increased by 5% year-over-year to $46.20 billion, driven by strong growth in the Ford Blue and Ford Pro segments.
    • U.S. sales saw a slight increase to 504,039 units in Q3 2024, marking a 1% rise compared to the same period last year.
    • Despite a 2% decline in the overall car market, Ford's internal combustion vehicle sales decreased by 2.8% year-over-year to 432,429 units.
  2. Profitability:
    • Ford's Q3 net income dropped by 25% due to a shift in its EV strategy.
    • The company reported adjusted earnings of $1.9 billion or $0.49 per share, in line with analysts' expectations.
    • Earnings before taxes from Ford Credit are expected to be about $1.6 billion.

EV Strategy Advancements

  1. Sales Performance:
    • Ford sold 23,509 electric vehicles in Q3 2024, a 12.2% increase from the previous year.
    • The F-150 Lightning was Ford's best-selling EV in Q3 2024, with 7,162 units sold.
    • Year-to-date, Ford sold 67,689 EVs, a 45% increase compared to the previous year.
  2. Strategic Shifts:
    • Ford has scaled back its EV investments due to mainstream buyers' resistance to high-priced battery-powered models and concerns about limited charging infrastructure.
    • The company canceled its much-anticipated electric three-row SUV in August, citing profitability concerns.
  3. Future Plans:
    • Ford plans to prioritize the introduction of a new digitally advanced commercial van in 2026, followed by two new electric vehicles.
    • The Ford+ plan for growth and value creation combines existing strengths with new capabilities and aims to build always-on relationships with customers.

Challenges and Outlook

  1. Cost Improvement and Growth:
    • Cost improvements and growth in the Ford Pro segment have fueled solid Q3 results.
    • Despite the growth, Ford guided to the lower end of its 2024 profit forecast, reflecting ongoing strategic challenges.
  2. Market Position:
    • Ford claims to have outsold all EV makers except Tesla from January to September 2024.
    • The company also leads in hybrid truck sales in the U.S., with the F-150 Hybrid being the best-selling hybrid pickup truck.
Overall, while Ford experienced growth in several segments and maintained a strong market position, it faces challenges related to its EV strategy and profitability.