Thursday, July 6, 2023

Ford Sales -- This Sure Doesn't Feel Like A Recession Despite Poor EV Results -- Sales Soaring -- June, 2023 And 2Q23

Locator: 45915AUTOS.  

EVs update.

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EVs Forecast

These were forecast by the company back in 2022:

  • 2023:
    • Tesla: 1.1 million EVs
    • F: 500,000 EVs -- original estimate
      • run rate
        • F-150 Lightning: 150,000 annual run rate
          • on track to triple production y/y
          • sold 3,600 through February, 2023
          • list price: $52K to $97K
      • Mustang Mach-E: 210,000 annual run rate

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Today's Reports

Link here.

Ford, June, 2023: link here:

But look at horrendous EV numbers for 2Q23, link here

Sales of Ford’s F-Series trucks jumped 34% during the second quarter compared with the prior year, including sales of an all-electric version of the F-150 that more than doubled to 4,466 units sold.
However, Ford’s EV sales during the quarter declined 2.8%, to 14,843 vehicles, as supplies of the Mach-E were short amid an overhaul of the factory that makes the EV.
Ford revamped that plant to increase production of the Mach-E during the quarter, part of a larger plan to significantly boost its electric vehicle production and turn a profit on its EV business by the end of 2026.
Ford’s electric vehicle sales remain small for now: EVs represented just 2.8% of the automaker’s total sales during the second quarter, while traditional internal combustion engines represented roughly 91% of sales. Hybrids represented 6.5% of sales.
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My Takeaways Re: Auto Manufacturers

Comments (pertain to US, only):

  • transition from "legacy" ICE to EV is going to be very, very, very expensive;
  • we will very likely see change in leadership positions at some legacy auto makers as shareholders become more frustrated;
  • there are three major groups of auto manufacturers
    • pure play EVs from the very beginning, e.g.: Tesla, Rivian, Lordstown
    • legacy auto makers transitioning to EVs, e.g.: Ford, GM, Stellantis
    • niche, luxury automakers, doing what they want, e.g.: Rolls-Royce, maybe Porsche in this group

Among the second group, legacy auto makers transitioning to EVs (Ford, GM, Toyota), there are three sub-groups:

  • CEO not sold on EVs, yet, e.g.: Toyota
  • CEO reluctantly moving forward, e.g.: GM
  • CEO going all in, e.g.: Ford

The second group (Ford, GM, Toyota):

  • will cover costs to ramp up EVs by inflating prices of ICE vehicles (already occurring)
  • GM will lose money hand-over-fist on ramping EVs, we won't know how bad it is; GM won't report
  • Ford will also lose money hand-over-fist ramping EVs, but F will break out the details

The second group (Ford, GM, Stellantis):

  • will give lip service to affordable EVs
  • they can't make money on "Bolt-like" EVs
  • they will gravitate to luxury EV brands
  • consumers will "see" entry level EVs starting at $50,000 whether or not that's accurate
  • tax incentives don't matter to most car buyers
  • tax incentives favor the wealthy who would buy/not buy regardless of tax incentives

The second group (Toyota)

  • hybrids (e.g., Prius): fake EVs; will be nothing more than a small niche
  • will reluctantly move to EVs, mostly to meet California mandates -- otherwise they can't operate in that state

First movers, autos: Tesla

  • other than Chinese no-names, Tesla could be "last-man" standing

EV niche:

  • medium-haul trucks / urban delivery vans / urban fleet  >>> long-haul trucks >>>> luxury sedans / SUVs >>>>> non-luxury SUVs EVs >>> pick-up trucks >>> muscle cars
  • best niche for EV trucks and vans
    • medium haul
    • east coast / west coast ports to neighboring warehouses / fulfillment centers
    • urban / last mile delivery

India:

  • my enthusiasm for India and four-wheel EVs has waned

US recession / EU recession:

  • will further dampen enthusiasm for EVs

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