Ford: A Future Electric Vehicle Leader?

Ford EV Stock

Tesla’s most recent sales figures underscore the supremacy of the electric vehicle (EV) pioneer in today’s market. But whether Tesla will remain the leader in electromobility in the future is another matter. After all, the Big Three legacy automakers know that the future of cars is electric. With their combined market power, global sales network and gigantic customer base, these global players will shape the electromobility revolution. Ford may not be the leader in the EV market today – but its progress toward building a supply chain for electric F-150 trucks could change that.

Ford: One of the world’s best-known auto brands 

Take Ford (NYSE:F), for example. The Michigan-based company is the second-largest automaker in the U.S. after General Motors (NYSE:GM). Itis probably as well-known worldwide as McDonald’s or Coca-Cola. Founder Henry Ford laid the foundation for today’s automobile industry at the beginning of the 20th century with the introduction of assembly line production.

As you probably know, Ford has not been a pioneer in the field of electric mobility. The company took a long time to put the topic on its agenda – but it is quickly getting over this reluctance. 

Ford’s latest electromobility news

In a recent interview with CNBC, Ford CEO Jim Farley announced plans to invest a gigantic $11.4 billion in electromobility. The money will be used to build a completely new EV plant with connected battery production in Tennessee, and two other battery factories in Kentucky.

Ford is thus trying to build a domestic, in-house battery supply chain. That goal is in line with the U.S. government’s agenda; the Trump and Biden administrations have both worked to reduce U.S. dependence on battery imports from China.

The company can therefore look forward to lavish government subsidies, which in turn reduces the investment risk for the company and ultimately also for you as a shareholder. Weeks ago, President Biden was photographed driving new electric car prototypes from Ford. Backing from the White House – what more could you want?

Ford wants to remain an American icon 

In fact, Ford has the best chance of becoming one of the great EV manufacturers of the ‘20s. The group sells around two million vehicles a year in the U.S., more than a million of which are in the F pickup series. The electrification of that F series is the focus of the new plants, according to Farley.

In Michigan, the best-selling F-150 in particular is also a future e-workhorse. After all, many rural Americans can’t maintain their lifestyles without their pickups. The challenge now is to convince consumers that electric trucks are capable of the same kind of heavy-duty performance as gas-powered trucks. Ford, at any rate, is confident that it can succeed.

My conclusion

Thanks in part to Washington’s backing, Ford will shape electromobility in the U.S. and beyond in the coming years. In view of its history and size, the company is excellently positioned for the future. The analysts also see it that way. According to Marketscreener, most experts recommend topping up the stock – with an average price target that is around 12% above Wednesday’s level. However, you should be aware of two possible negative factors

First, Ford is also heavily burdened by the ongoing chip crisis, which reduces short-term growth. Second, the reduced dividend is still a blemish at the moment. But the emphasis here is on “still.” Analysts expect the payouts, which were stepped down because of the COVID-19 crisis, to pick up again in the coming years. All in all, the Ford giant is on the right track.

Dr. Gregor Bauer
Dr. Gregor Bauer
Dr. Gregor Bauer credits his trading success to combining fundamental aspects of a trade with expert technical analysis. A Certified Financial Technician from the International Federation of Technical Analysts (IFTA), he’s rated as one of Germany’s top 300 economic experts.
Dr. Gregor Bauer
Dr. Gregor Bauer
Dr. Gregor Bauer credits his trading success to combining fundamental aspects of a trade with expert technical analysis. A Certified Financial Technician from the International Federation of Technical Analysts (IFTA), he’s rated as one of Germany’s top 300 economic experts.

Related Articles