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Ford his having a rough time in the markets as they had their "biggest intraday drop since July 2016" today.

Ford shares fell as much as 10% Wednesday (Feb 5) because of "costs linked to launching revamped F-150 pickups will hurt upcoming results and extend an earnings slump partly blamed on the botched rollout of its signature SUV, the Explorer."

Bloomberg is comparing this struggle to Tesla and how they had a rough time trying to increase Model 3 production. I'm not sure what cause this stumble by Ford but they need to pick things up for when Mach-E production starts.

Ford Motor Co., founded 100 years and 15 days before Tesla Inc., is paying the price for a sudden role reversal: It’s now the one struggling to produce a new model on time, at scale and without losing money.

Ford shares fell as much as 10% Wednesday, their biggest intraday drop since July 2016, after the automaker projected lower-than-expected profit for this year and reported that 2019 ended with a quarterly net loss. Costs linked to launching revamped F-150 pickups will hurt upcoming results and extend an earnings slump partly blamed on the botched rollout of its signature SUV, the Explorer.

The disappointing forecast and faulty introduction of a crucial vehicle are reminiscent of the struggles investors watched Elon Musk go through for years. Tesla almost went out of business, the billionaire chief executive officer has said, because of the “production hell” the electric-car company went through ramping up output of its Model 3 sedan.

Now, a week after Musk accelerated the introduction of his new Model Y crossover for the second time in as many quarters, Tesla had a market capitalization just shy of $160 billion at the close Tuesday. Ford was valued at just a quarter of that -- $36.4 billion.

“We can’t miss a beat now in the product launches,” Ford Chief Executive Officer Jim Hackett said on an earnings call, just after Chief Financial Officer Tim Stone summed up the company’s financial performance as “not OK” in an interview.

Ford management “went to the desert to get to the bottom” of what went wrong with the Explorer, Hackett added. “I have zero questions that we have identified what was at risk there, what bad decisions we made, what things we have to change. That’s all in the rearview mirror and now it’s about executing.”

Tesla shares more than doubled this year as of Tuesday, an ascent that left some on Wall Street in awe and others aghast. The stock gave back some of those gains Wednesday, dropping as much as 11% to $787. Ford traded at $8.26, the lowest intraday price in almost a year.

Musk’s next-largest U.S. foe, General Motors Co., on Wednesday forecast flat earnings for 2020. Its market value peaked at about $67 billion in October 2017 and has crept below $50 billion.

Ford trades at a steep discount to Tesla despite continuing to handily outperform Musk’s company on several metrics. For one, Ford shipped more than 5.4 million cars and trucks to dealers worldwide last year, more than 14 times the 367,500 vehicles Tesla delivered to customers.

But the direction those respective numbers are heading trouble Ford’s investors and excite Tesla’s. Ford’s shipments fell 10% last year, and the company didn’t give a projection for 2020. Tesla just increased annual deliveries by 50% and is projecting at least 35% growth for 2020.

Ford sees earnings before interest and taxes falling to a range of $5.6 billion to $6.6 billion this year, trailing analysts’ average estimate of $7.4 billion. Adjusted profit in the last quarter of the year also missed projections.

On a GAAP basis, Ford recorded a net loss of $1.67 billion for the fourth quarter. Investors typically focus on adjusted figures that back out special items such as restructuring costs and the remeasurement of pension plans. Ford has said it expects to rack up $11 billion in charges over several years making its operations more financially fit.

Credit-ratings companies have raised concerns about the efficacy of the restructuring efforts, with Moody’s Investors Service downgrading Ford to junk in September. S&P Global Ratings then cut the company to the lowest investment-grade rating in October.

Tesla, by contrast, could be due for upgrades after ending last year with a record cash balance and three straight quarters of positive cash flow.

In closing his call with analysts -- who at times sounded frustrated about the lack of specifics Ford provided in its guidance for the upcoming year -- Hackett pleaded for patience and vowed progress.

“Can we execute? Of course we can. We will promise that we will earn your trust,” Hackett said. “I don’t want you to think that we have to struggle on the way to the future. We aren’t going to cancel the future because of the focus on earnings. We think that the improvement in earnings that we all want and the requirement that we have to get to our future can live in a synergistic way.”

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Ford is continuing to struggle with investors. Shares of Ford hit an 11-year low this week.

Shares of Ford hit an 11-year low this week. Newly appointed Ford COO Jim Farley said the company has a “sense of urgency and crisis” on Wednesday at a conference for investors in New York. The big question is if these challenges, and the need for higher near-term profit margins, will affect the company’s EV plans.

Farley this week said:
Everyone at Ford knows the situation we’re in. I can see it on the faces of my colleagues, and it takes me back to about 10 years ago. I’ve seen the look before.
The company is facing these woes as it prepares to launch 10 new vehicles in the next two years, including the Ford Mustang Mach-E and an all-electric Ford F-150 pickup.

Jim Hacket, Ford’s CEO, said the company needs to move toward “higher-growth, higher-margin” areas of the business. He believes electrification and autonomy are part of that movement. But more immediately, Ford will later this year introduce the latest generation of its F Series pickup truck, a critical source of profit for the company.

Last year’s launch of the new Ford Explorer, by most accounts, was botched. The Detroit News pointed to delays, faulty seats, loose wiring harnesses, and buggy software. Ford delivered 26% fewer Explorers in 2019.

Ford earlier this month reported a $1.67 billion loss during the fourth quarter and missed Wall Street earnings expectations on increased pension contributions and higher labor costs. So Ford investors and others are debating whether the company has the ability to retrench while pursuing EVs. Of course, the need to reduce emissions makes the shift to electric cars a necessity.

Carla Bailo, CEO of the Center for Automotive Research in Ann Arbor, told the Detroit Free Press that Farley needs to more clearly define the “future of mobility in terms of electrification,” including how it will partner with Volkswagen and Rivian.

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Tesla would have been out of business with this kind of narrow-minded focus on the near-term. Tesla had over fifteen years of operational loss before any quartly profit seen. Do we have to point out to Ford’s Board of Directors about Tesla’s current market cap?

To make money in the future, it will cost you money today. Stop your whining, bite the bullet...or become irrelevant.
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