Stonks: Ford Flails on Forecast

Matthew Guy
by Matthew Guy
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stonks ford flails on forecast

Holders of Ford stock were disappointed this week when Blue Oval shares sank on news that supply chain issues and inflation will likely eat into Q3 results. The stock nosedived 12 percent on Tuesday, one of its sharpest falls in a decade.

The company was upfront about its fortunes, saying yesterday that parts shortages had delayed deliveries of new cars and inflation-related costs would be an eye-watering $1 billion more than expected for the quarter. Turns out it’s more than the prices of milk and bacon which have shot to the moon. In all, Ford shares slumped 12 percent on Tuesday to just a hair over 13 dollars. In trading today, it has recouped some of those losses; at the time of this writing, the stock stood at $13.50, clawing back roughly one-third of the losses.

This is newsworthy because many talking heads were expecting the chip headaches and parts shortages to have sorted themselves out by now. By most accounts, they have not. These issues hit the bottom line of automakers and are costly on their own; adding inflation to the mix makes the financials even more volatile.

All the same, Ford stands by its so-called ‘full year guidance’ which is a term used by numbers nerds to speak about how a large company expects to find the condition of its books at year-end. This could signal confidence from corner offices that Ford expects these issues (particularly the parked, chipless vehicles) to be temporary, simply pushing sales into the next quarter and having it all come out in the wash. With today’s partial recoup of stick price, it seems some on Wall Street agree despite yesterday’s profit warning.

[Image: Ford]

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Matthew Guy
Matthew Guy

Matthew buys, sells, fixes, & races cars. As a human index of auto & auction knowledge, he is fond of making money and offering loud opinions.

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6 of 22 comments
  • VoGhost VoGhost on Sep 22, 2022

    What Ford has done well is to make vehicles Americans want to buy. I thought they were crazy to abandon sedans, but it worked for them. They moved the resources that were engineering cars over to introducing the Bronco, Bronco Sport, Maverick, Lightening and Mach-e, all of which are in high demand.

    Where Ford screwed up is with supply chain resilience, where their inability to meet demand for these products, and inability to contain costs is becoming a real liability.

    • Jeff S Jeff S on Sep 24, 2022

      JMII--I have a Maverick XLT hybrid and love it but if the Maverick were not available or I couldn't have gotten one I would have bought a Santa Cruz because I wanted a compact pickup and I do use the bed of my truck as I have on all my previous trucks. For my purposes I prefer the Maverick especially have a hybrid which the Santa Cruz does not have. I am glad the Santa Cruz is offered and would like to see other manufactures offer a compact pickup.

  • Arthur Dailey Arthur Dailey on Sep 22, 2022

    What 'competitor' currently exists for the Maverick in North America? The Santa Cruz at least in Canada is in a different price bracket and appears to be more 'style over substance'. The Maverick's hybrid powertrain has been proven over a number of years and many millions of miles in other Ford vehicles.

    • See 2 previous
    • JMII JMII on Sep 23, 2022

      Spec wise the Mav and SC in the middle trim levels in the US are basically identical. In Canada you can't get a non-turbo FWD SC so your forced into the most expensive trim immediately.

      As noted the Mav's claim to fame is: cheap + hybrid. However once you start checking option boxes the SC comes out ahead. And yes a fully optioned SC is more expensive but it also has more tech. The biggest swing factor is styling - those that want that boxy truck look think the SC is ugly and thus will not purchase one regardless. I've read countless comments online about these two vehicles and hands down the fans of each draw the line at the styling (both interior and exterior). For example as a SC fan I think the Mav looks outdated and boring.

      If you want a small truck - and MANY do - then you have only these two choices. On the SC forums there are plenty of posts from those that have given up on Ford's never ending wait list and picked up a SC instead. While Hyundai can't keep up with demand either their allocation system means a SC could show up at your local lot. For the Mav they are order only and all spoken for. Any sitting on a Ford lot is a dropped order and will be over MSRP for sure.

  • Tassos Unlike Tim, I don't use this space as a wastebasket for ANYTHING BUT a proper used car.If you seriously need a car AND you are as destitute as Tim's finds imply, HERE IS A PROPER ONE FOR YOUR NEEDS:You can probably get it for only $4k, WITH Leather, Factory Navigation, plenty of room and a V6. even considered getting it myself as an extra reliable car.
  • Jeff Of all the EV trucks I like the Rivian the best but I am still years away if ever from buying an EV.
  • Kwik_Shift I definitely like the looks of the newest 300s over the Chargers.
  • SCE to AUX "Should car companies shack up with tech giants in order to produce legible infotainment systems and the like? Or should they go it alone?"Great question(s).The River Rouge days are gone, where Ford produced whole cars out of raw materials entering the plant at the other end. Nearly everything is outsourced these days - sometimes well, sometimes disastrously.But the problem with infotainment systems is that they are integrated with the car's operation. VW has delayed entire products for issues with infotainment.For me, the question boils down to a contractual arrangement - who owns and maintains the code forever? Since more and more of the car's function is tied to the infotainment system, I'd argue that the car mfr needs to own it - especially the larger ones.Do mfrs really want to share intellectual property with Huawei just to fast-track some code they've managed themselves in the past?
  • Kwi65728132 I always did like the styling of the 300C and it was on my short list for a new (to me) rear wheel drive, naturally aspirated V8 luxury sedan but I found a Hyundai Equus that was better optioned than any 300C I could find and for several grand less.