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Ford’s Q3 US Sales Drop 4.9% YoY, Stock in the Red

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Ford (F) announced its third-quarter US sales figures today. Its Q3 2019 US sales came in at 580,251 units, indicating a 4.9% year-over-year (or YoY) decline. Wall Street analysts had estimated a 6.1% decline in Ford’s sales figure for Q3.

Ford is transitioning away from sedans to SUVs and trucks. In an otherwise decelerating US auto market, SUV and truck demand remains the only bright spot.

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Fiat Chrysler’s US sales

Fiat Chrysler (FCAU) also released its quarterly sales figures today. The company reported a marginal increase of 0.1% due to the strength of its Ram pickup trucks.

Other automakers’ sales fell too

Yesterday, Nissan (NSANY), Toyota (TM), and Honda (HMC) reported their September vehicle sales. The sales for all three companies plummeted by double digits during the month.

While Toyota and Honda’s sales declines surpassed analysts’ estimates, Nissan recorded a slight beat. General Motors (GM) is expected to release its sales figures for the quarter today. Analysts expect GM to report a 7.8% increase in its third-quarter sales figures.

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Tesla to release Q3 deliveries this week

Tesla (TSLA) plans to report its Q3 delivery numbers sometime this week. Wall Street analysts expect a sales figure of 98,000.

According to a leaked email by Tesla CEO Elon Musk, the company was pushing for deliveries of 100,000 for the quarter. Tesla delivered 95,200 vehicles in Q2, which was a record delivery number for the company.

Ford’s transaction price improved on changed sales mix

Ford mentioned in its press release that its truck and SUV mix climbed to 87% in Q3 2019, 5 percentage points higher YoY. This also led to a 6.2% increase in the average transaction price for the company at the end of September 2019 compared to the same period in 2018.

Compared to an 8.8% increase in truck sales, Ford’s SUV and car sales declined 10.5% and 29.5%, respectively, YoY. Another interesting feature of the quarterly sales report was that the demand for Ford’s highly popular F-Series pickup category slumped by 6% YoY during the quarter.

Commenting on the sales report, Mark LaNeve, Ford’s vice president of U.S. Marketing, Sales and Service, noted, “Our truck, van and commercial business continued to be strong in the third quarter, with record van sales and continued F-Series sales leadership.”

Ford’s stock price performance

Ford stock was trading down by nearly 4% at 11:30 AM EDT today. Year-to-date, its stock has gained 16.3%.

Yesterday, Buckingham Research cut its target price for Ford stock from $9 to $8. Yahoo Finance reported that Buckingham analyst Joseph Amaturo stated, “We now have increased concern about U.S. volumes and net pricing, particularly on full size pickups and SUVs.” Amaturo continued, “We are also becoming increasingly concerned about end market demand in many of the markets [Ford] participates in.”

On September 9, Moody’s cut Ford’s credit rating to junk status on concerns of significant operating and market challenges for the company.

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