The back story. Ford Motor (ticker: F) made a big bet on trucks last year when the company announced it would stop making sedans and re-focus on its larger models.
But Ford wasn’t alone in its pivot from sedan models. Sedans have declined in value as consumers shift toward larger vehicles. President Donald Trump has criticized General Motors (GM) for closing its plant in Lordstown, Ohio. The plant produced GM’s Chevy Cruze sedan, which was discontinued in the U.S.
Even electric car maker Tesla unveiled a crossover SUV model last week. Traditional manufacturers, meanwhile, are working on electric and autonomous vehicle projects of their own. Ford and Volkswagen announced an electric and autonomous vehicle partnership earlier this year.
Americans LoveTrucks
Light trucks as a percentage oftotal light vehicle sales in theU.S.
Sources: Ward's AutomotiveGroup, Bloomberg
%
1995
’10
20
40
60
80
What’s new. Ford announced Tuesday that it would add 550 jobs to its Kentucky Truck Plant in Louisville and increase production of the Ford Expedition and the Lincoln Navigator this summer by 20%
“Kentucky Truck Plant is home to two of Ford and Lincoln’s most successful vehicles,” John Savona, Ford’s vice president for North American manufacturing, said in a statement.
Ford stock was up 3.4% at midday on Tuesday, compared to a 0.6% gain for the S&P 500.
Moving forward. Ford’s plan to invest more in trucks is in line with industry trends, and the company could also get a boost from its investment in electric vehicles.
Expedition sales increased 35% in 2018, according to the company. Navigator sales increased 70% in 2018, which Ford said was its best year since 2007.
But investors are still waiting on a U.S. trade deal with China, which could hurt or boost stocks depending on the outcome.
