Ford (F) has confirmed a temporary reduction in shifts at its F-150 Lightning electric pickup plant in Detroit, signaling a potential dip in demand for its highly regarded electric vehicle. The Wall Street Journal reported last Friday that the shift cut was in response to subdued sales of the Lightning. Approximately 700 jobs are expected to be affected by this move, alongside a price reduction of up to $15,000 on the current 2023 F-150 Lightning EV models.
CFRA analyst Garrett Nelson weighed in on the development, stating, “We think Ford’s announcement is emblematic of the difficulties traditional automakers have faced with ramping up EV production, but also reflects consumer demand for EVs that wasn’t what it once appeared to be in terms of the robust reservation counts for certain new models.”
In a further indication of shifting market dynamics, Ford recently decided to cancel dealer stock orders for the Lightning. These orders are typically placed by dealerships to maintain inventory for customers looking to make immediate purchases. This move underscores a potential slowdown in demand for the electric pickup.
Overall, it appears that Ford may have overestimated the level of enthusiasm surrounding its electric pickup venture, prompting the automaker to refocus its attention on its conventional gas and hybrid F-150 models. Ford’s Q3 report revealed a 46% year-over-year decrease in Lightning sales, with only 3,503 units sold.
Nelson added, “Ford and other automakers are starting to reconsider their EV growth strategies, shifting away from pure battery EVs more towards plug-in hybrids and even ICEs [internal combustion engines].” This strategic pivot is reflective of a broader industry trend, as automakers seek to strike a balance between electric and hybrid offerings to meet evolving consumer preferences.
Investors are poised to gain further insights into the demand dynamics of the F-150 Lightning when Ford releases its earnings report after the market closes on Tuesday, October 26. In the interim, Ford’s production shift cut stands as a stark reminder to fellow traditional automakers of the formidable challenges associated with scaling up electric vehicle production, as consumer demand for EVs continues to lag behind initial projections.
Source: Yahoo Finance
