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Ford Motor (F – Free Report) recently announced plans to invest an additional $180 million in its Halewood EV powertrain facility in northern England.
In October, F announced an investment of $280 million to transform its Halewood transmission facility to develop electric power units for future European Ford passenger and commercial EVs. Production is scheduled to begin in 2024. The current flow of fresh funds will boost annual production at the plant to 420,000 units per year, up from 250,000 previously, an increase of 70% in factory output. This, in turn, will provide powertrains to a large number of European Ford models by 2026.
Ford has been a major employer in Halewood for almost 60 years. The investment will secure jobs for more than 500 people in Halewood who will assist in EV component assembly for the European market.
Ford’s vision for Europe revolves around a business model focused on commercial vehicles and the electrification of its vehicle range. Halewood is a critical player in Ford’s first in-house investment in EV component manufacturing in Europe. Ford aims to have nine fully electric models on sale in Europe by 2024, with Halewood supplying power units to assembly plants in Romania and Turkey for five high-volume models.
It’s been a while since Ford got ahead of the EV race and it’s accelerating towards an all-electric product range. Its bold move into electrification has made it the second best-selling EV brand in the United States. Ford’s ambitious Ford+ plan, with its deep focus on increasing profitability, exploring the future of e-mobility and enhancing the customer experience, is sparking optimism. Its flagship rejig plan to split its EV business into a separate unit within the company will open up growth opportunities.
The firm’s aggressive EV push, with planned spending of around $50 billion by 2026 and target production of more than 2 million EVs by the end of 2026 (representing a 49% CAGR for 2023-2026), bodes well for long-term growth. By 2030, Ford expects EVs to account for 50% of its global sales, cementing its position in the red-hot EV landscape.
The recent announcement is in sync with the auto giant’s plan to go all-electric overseas by 2030.
F shares have lost 29.1% over the year compared to the industry’s 48.4% decline.
Image Source: Zacks Investment Research
Zacks Rank and Key Picks
F currently carries a Zacks Rank #3 (Hold).
Here are some better ranked players in the automotive space – CarParts.com (PRTS – Free Report), using Zacks Rank #1 (Strong Buy), and Allison Transmission Holdings (ALSN – Free Report) and Genuine Parts Company (GPC – Free Report), each carries a Zacks Rank #2 (Buy). You see the complete list of Zacks Rank #1 stocks today here.
CarParts has an expected revenue growth rate of 85% for the current year. The Zacks Consensus Estimate for current year earnings has been revised up 72.7% over the past 30 days.
Allison has an expected revenue growth rate of 26.1% for the current year. The Zacks Consensus Estimate for ALSN’s current year earnings has been revised up 0.6% over the past 30 days.
Genuine Parts has an expected revenue growth rate of 18.1% for the current year. The Zacks Consensus Estimate for current year earnings has been revised down 0.2% over the past 30 days.
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