The Ford F-150 is the second-highest grossing branded product in the world. It is second only to the iPhone. Ford did $42 billion in sales of the F-150 in 2019. Morgan Stanley has estimated that the F-150 may be responsible for 90% of Ford’s total global profit.
Ford and GM own the light-duty truck market in the U.S., but new competitors are emerging. Electric vehicle drive trains are all the rage in the stock market today. Not so much in the actual market for trucks just yet, but that may change. If it does, Ford and GM will have to stay on top to survive.
Ford understands the stakes if U.S. consumers take up electric trucks (still a big question mark).
To prepare to compete in the electric truck market, Ford announced this week that it is investing $700 million to expand its River Rouge plant to produce battery-powered F-150s. Production of fully electric trucks is expected to begin by mid-2022.
The electric F-150 will be more powerful and accelerate faster than gas-powered F-150s. It will also be as much as 40% less costly to maintain according to the company.
Mike Colias at the WSJ has more:
For decades, Ford, GM and Fiat Chrysler have dominated the U.S. market for big, brawny pickup trucks, used by contractors and ranchers to haul equipment and weekend warriors to tow boats. Toyota Motor Corp. and Nissan Motor Co. have tried to crack the big-truck market but haven’t put much of a dent in Detroit’s lead.
Ford and GM have responded to the electric-truck newcomers with a two-pronged approach, readying their own plug-in trucks while also joining with startups.
Ford has invested $500 million in Rivian and is working on a future electric vehicle based on the Rivian’s technology, while also developing the plug-in F-150.
GM is working on an electric pickup truck based on its own technology. The company on Wednesday said it would build the mechanical guts of its future electric vehicles in house, including motors and transmissions, adopting a vertically integrated approach similar to that of Tesla.
Read more here.