Ford couldn’t build F-150s fast enough — and it hurt 4th-quarter sales
The baby Bronco known as the Bronco Sport, a surprisingly popular new release by Ford in late 2020, offered a bright spot in the fourth quarter sales report amid otherwise grim numbers.
“It’s everything we could get to the dealers. It’s being sold as fast as they come off the truck,” Erich Merkle, U.S. sales analyst Ford, told the Free Press. “It’s an incredibly strong start. It’s exceeding our expectations.”
Some consumers waiting for the bigger two- and four-door Bronco have said they purchased the Bronco Sport because they didn’t want to wait until summer to get the all-new SUV meant to compete with the Jeep Wrangler.
Buyers snapped up 5,098 Bronco Sport SUVs in December alone, on top of the 22 sold in the final hours of November just as the new vehicle went to market. SUVs carried the day for Ford between October and December, while the normally dependable Ford150 saw sales drop.
For the quarter, compared with the same period in 2019, Ford brand sales sank 10%, Lincoln brand sales fell 7% and total company sales dipped 9.8%, the company reported Wednesday via news release.
The not-so-pretty detail in hard numbers:
—Ford sales dropped from 568,507 to 511,735
—Lincoln sales dropped 33,355 to 31,014
—Overall sales dropped from 601,862 to 542,749
—Ford F-150 sales dropped 233,952 to 198,388, a 15.2% slide
Contrast those numbers with crosstown rival General Motors, which reported on Tuesday an overall 4.8% increase in fourth-quarter sales, with luxury brand Cadillac up 5.8%, Chevrolet up 4.6% and GMC jumping 10.4%. For the quarter, GM sold 771,323 vehicles, its best fourth-quarter retail sales since 2007. And Fiat Chrysler Automobiles dropped only 8%.
Unlike its rivals, Ford saw extended impact of the COVID-19 shutdown that lasts two months because the automaker was unable to create a backlog of 2020 F-150 trucks while changing over factories to build 2021 models. So inventory couldn’t keep up with demand, dealers reported.
“The F-Series continues to be the bestselling truck. It’s not as though that’s in jeopardy,” Merkle said.
During the past three months, Ford held the lead in the pickup truck wars with F-Series selling 198,388 against the Chevy Silverado at 179,444 and Ram at 161,266.
The big issue is not having enough stock, and that will change dramatically in 2021, he said. “Our new product is not even out yet. Fourth quarter represents an inflection point for us.”
Both the Bronco Sport and the F-150 are selling within six days of arriving on dealer lots, Merkle said. And the automotive market rebound after the coronavirus shutdown devoured supplies that Ford simply couldn’t build fast enough because of the factory changeover, a challenge competitors didn’t face.
“It didn’t allow us to build up enough F-150s,” Merkle said. “We had the production shutdown and then sold down our 2020 F-150 stock sooner because of the market rebound. So it limited our inventory on outgoing 2020 F-150s prior to the changeover. At this point, we’re fully utilizing our production, optimizing our production at both plants” at Dearborn Truck and Kansas City Assembly.
He emphasized, “Product is moving as quickly as you can get it off the truck.”
Ford changed over its plants and began delivering its all-new 2021 F-150 pickups in the fourth quarter with dealers reporting strong customer demand. The company has acknowledged a stockpile of trucks around the airport in metro Detroit, near Flat Rock Assembly and in the Kansas City area awaiting seatbelt installation, software updates and quality review, as first reported by the Free Press.
“Anytime that Ford falls short on F-150 sales is a matter of concern,” market analyst Jon Gabrielsen, who expressed concern about its impact on 2020 earnings.
Meanwhile, Ford SUV sales grew 4% year over year, carried by:
—Explorer up 28.7% from 51,284 to 66,008
—Expedition up 7.5% from 24,267 to 26,091
—Lincoln Aviator up 13.3% from 6,424 to 7,280
Both Explorer and Aviator had launch challenges a year ago that impeded sales so growth was to be expected.
Playing on strengths in vehicles often purchased for commercial use, heavy trucks spiked 31% to 4,106 and Transit vans jumped 2.7% to 37,886. The luxury Lincoln Corsair/MKC was the only car to show growth with 6.6% to 8,050.
Sales of just about everything else dropped: Mustang, GT, EcoSport, Escape, Edge, Flex, Ranger, E-Series, Transit Connect, Lincoln MKZ, Continental, Nautilus/MKX, MKT, Navigator.
Michelle Krebs, executive analyst for Autotrader.com, said, “Ford clearly lost momentum in the fourth quarter when other automakers gained at year’s end. Ford has a lot of work to do in 2021, which should be a good year for the company with some important product launches.”
Ford CEO Jim Farley, who took the helm on Oct. 1, has predicted a strong 2021 as workers ramp up supplies and dealers fill orders.
Andrew Frick, who just took over avice president of Ford sales in U.S. and Canada, said in a news release that the F-150, Bronco Sport and Mustang Mach-E position the company well for the coming months.