Ford U.S. sales down 6.8% in 2021 due to chip shortage as fourth quarter improves

In line with an industry that has seen massive fallout from a global semiconductor shortage, Ford Motor Co. sales in the United States fell in 2021, but the latter part of the year marked major milestones for the Dearborn automaker, which has beaten its foreign and domestic rivals. to become the best-selling automaker in the fourth quarter.

For the year, Ford recorded around 1.9 million sales in the United States, according to figures released Wednesday, up from more than 2 million in 2020 and more than 2.4 million in 2019. Sales were also down by 17 , 1% in December. But the fourth quarter was a solid one for the automaker, which took the top spot in sales in the United States and conquered its position as the No. 2 seller of electric vehicles in 2021, behind market leader Tesla Inc.

In the United States, sales are forecast to increase slightly in 2021 to reach around 15 million vehicles. But even though it’s better than in 2020, when sales plummeted due to the pandemic, they are still well below the 17 million in sales of 2019.

Nonetheless, Ford managed to increase production and sales volume in the fourth quarter after being hit hard by the chip shortage at the start of the year. It posted 508,451 fourth quarter sales, up 26.8% from the third quarter.

The company’s F-Series franchise also hit its 45th consecutive year as the nation’s best-selling truck, with sales of 726,004 down 7.8% year-over-year. Segment competitor Ram finished in second place with 569,388 pickup trucks sold, while Chevrolet finished with 529,765 Silverado truck sales. General Motors Co.’s other truck maker, GMC, sold 248,924 Sierra pickup trucks.

“Ford ended the year strong, as the only American automaker to hit half a million fourth quarter sales, making Ford the best-selling automaker in the United States,” said Andrew Frick, Ford’s vice president of sales for the United States and Canada, in a statement. .

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“Based on the strong success of the Mustang Mach-E, Ford has moved up to second place in electric vehicle sales in the United States behind Tesla,” he added. “Last year was a pivotal year for Ford in the electrified vehicle segment and this year we continue to grow, adding the F-150 Lightning and E-Transit to our electric vehicle lineup. vehicle orders in December, which will ensure continued momentum until 2022. “

Meanwhile, GM saw sales drop 13% in 2021 to around 2.2 million vehicles. For the first time in 90 years, the Detroit-based automaker ranked second in annual sales in the United States, relinquishing its No. 1 spot to Japanese automaker Toyota Motor Corp.

GM sales fell 43% year-on-year in the fourth quarter to 440,745 vehicles. Stellantis NV also saw its sales fall; Fourth-quarter sales were down 18% to 412,000 units, and the automaker ended 2021 with sales down 2% to nearly 1.8 million.

For foreign automakers, the results for 2021 have been mixed. Honda Motor Co. sold nearly 1.5 million vehicles in the United States, up 9%. Hyundai Motor Co. sold more than 738,000 vehicles, up 19%. Subaru Corp. sales fell 4.6% to nearly 584,000. Tesla does not break down sales by geographic area, but delivered 936,000 vehicles globally last year, an increase of 87%.

Hot new products

Ford attributed much of its strength in the fourth quarter to demand for a popular new vehicle lineup, including the Bronco SUV, the Maverick pickup truck, and the all-electric Mustang Mach-E.

Among Ford’s most popular new products is Maverick, a compact pickup truck that comes standard with a hybrid powertrain. Ford sold 6,030 Maverick trucks in December, including 2,159 hybrids and a total of 13,258 in 2021 after their fall launch.

Another bright spot for the automaker has been SUVs, with sales in the segment up 10.4% last year. The new Ford Bronco, one of the most anticipated launches of 2021, recorded just over 35,000 sales to end the year. Bronco’s little brother, the Bronco Sport, launched in late 2020, recorded 108,169 sales in 2021.

For the year as a whole, Mustang sales were down 14.2%. Sales of Ford’s luxury brand Lincoln fell 17.5%.

“Ford had a very hectic period in the middle of the year, especially regarding the lack of chips for its F-150. But they started to get by at the end of the summer, and their inventory started to improve, ”said Michelle Krebs, executive analyst for Cox Automotive. “And there have been some very positive things for Ford this year. The Bronco took off. The Maverick has really captured people’s imaginations.

Meanwhile, Ford said it took 70,000 orders for new vehicles from retail customers in December, up 58,000 vehicles from a year ago. Thirty-three percent of its retail sales came from fulfilling customer orders. Since the onset of the chip shortage, the automaker – along with some of its competitors – has been looking at a model in which customers order and configure their vehicle before it’s built rather than buying the bundle. .

The company expressed optimism about its position to start 2022, with 247,000 vehicles in stock, which it said was the best position in the industry.

VE # 2 seller

2021 marked a major milestone for Ford as the automaker aims to double its electric vehicle capacity to 600,000 vehicles per year within two years and consolidate the No. 2 position in the US market behind Tesla. Ford achieved this goal in 2021, posting its best sales figures for all-electric vehicles with 27,140 Mustang Mach-E sales.

The result was in part due to GM’s recall of all Bolt EVs and EUVs – more than 141,000 manufactured since the 2017 model year – and the suspension of sales of the only all-electric vehicle it had on the market for a while. much of 2021.

Still, Ford and pundits expect the automaker to continue to be a major contender in the electric vehicle space this year as it prepares to launch the all-electric F-150 Lightning, an electric version. battery-powered truck in the United States. The pickup is expected to go on sale this spring, and Ford’s inventory was up this week following news that the automaker plans to nearly double the truck’s production capacity due to strong demand.

In December, the automaker hit a new record for electrified vehicles with 12,284 sales, up 121% year-on-year.

Ford shares traded Wednesday at their highest level since 2001 after opening at $ 24.06 a share before closing at $ 23.66. Ford had the best performing auto inventory of 2021, gaining 136%.

Investment research firm CFRA Research raised its 12-month price target for Ford shares from $ 8 to $ 32 and reiterated its buy opinion following the automaker’s sell report.

“With additional market share gains from the F-150 Lightning, Bronco and other vehicles, we remain bullish on Ford, expect a combination of earnings growth and multiple expansion to propel stocks up. increase as EV sales increase and inventory is valued less like a single-digit P / E (price-earnings ratio) for many automakers, ”CFRA Vice President Garrett Nelson wrote in a note.

“In addition,” he added, “we have a high degree of confidence in CEO Jim Farley and view (Ford’s) global operations as having considerable rewards at hand in terms of additional costs and costs. ‘improved productivity. “

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