DEARBORN, Mich. - Ford Motor Company (NYSE: NYSE:F) has announced the expansion of its production capacity for the F-Series Super Duty trucks at the Oakville Assembly Complex in Ontario, Canada. The plant, which is set to begin operations in 2026, will add an initial capacity for 100,000 trucks, including vehicles equipped with multi-energy technology.
This strategic move is part of Ford's Ford+ plan aimed at profitable growth, which includes maximizing the company's manufacturing footprint and extending its global truck leadership. The expansion is expected to secure approximately 1,800 jobs at the Oakville Assembly Complex and create about 150 jobs at the Windsor Engine Complex, in addition to roughly 70 jobs and additional overtime at U.S. component plants.
The decision to increase production capacity comes in response to high demand for the Super Duty trucks, which are essential for businesses and customers globally. Ford's President and CEO, Jim Farley, emphasized that the current production at the Kentucky Truck Plant and Ohio Assembly Plant is not sufficient to meet customer demand.
He also highlighted Ford's commitment to developing an electric vehicle business, including the introduction of three-row electric utility vehicles.
The total investment for the expansion of the Super Duty production is estimated at $3 billion, with $2.3 billion allocated for the assembly and integrated stamping operations at the Oakville Assembly Complex. This investment is set to bring the plant to full flexibility in production capabilities.
Ford's COO, Kumar Galhotra, stated that the investment aligns with their Ford+ plan and will have a swift payback, benefiting Ford, its employees in Canada and the U.S., and, most importantly, the customers.
The increased production also has positive implications for the U.S., with new hires and additional overtime planned at component plants supporting Super Duty production, including Sharonville Transmission Plant in Ohio, Rawsonville Components Plant in Michigan, and Sterling Axle Plant in Michigan.
Ford leads the truck market in the U.S., with the F-Series being the best-selling truck for 47 consecutive years in America and 58 years in Canada. The company's truck production supports over 500,000 jobs in America and is a significant contributor to Ford's position as the largest producer and exporter of vehicles in the U.S.
This expansion is based on a press release statement from Ford Motor Company.
In other recent news, Ford Motor Company reported a modest 1% increase in its second-quarter vehicle sales, despite the broader struggle within the U.S. auto industry caused by a cyberattack on CDK Global (NASDAQ:CDK) Inc. In another development, Ford is set to introduce a new electric vehicle (EV) with a price tag of $30,000, expected to generate profits within approximately two and a half years. This aligns with the company's broader strategy to transition towards electric mobility.
Meanwhile, a coalition of 26 state attorneys general filed a lawsuit against the Biden administration's recently established vehicle fuel economy regulations. The attorneys general argue that these new rules pressure car manufacturers into accelerating the production of electric vehicles.
Concerning this, Bank of America (NYSE:BAC) Securities analyst John Murphy advised legacy U.S. automakers, including Ford, to withdraw from the Chinese market to conserve resources during the costly transition to EVs.
InvestingPro Insights
As Ford Motor Company (NYSE: F) gears up to enhance its production capabilities for the F-Series Super Duty trucks, investors and stakeholders are closely monitoring the company's financial health and stock performance. According to InvestingPro data, Ford boasts a robust market capitalization of $57.81 billion, indicating its significant presence in the automotive industry. With a P/E ratio (adjusted for the last twelve months as of Q1 2024) at a competitive 10.12, the company trades at a low price-to-earnings ratio relative to its near-term earnings growth. This could signal an attractive valuation for investors considering the company's growth prospects.
Furthermore, the company's dividend yield as of 2024 stands at an impressive 5.39%, showcasing Ford's commitment to returning value to its shareholders. This is further evidenced by the fact that the company has consistently paid dividends for 13 consecutive years—an InvestingPro Tip that highlights the company's stability and reliability as an investment.
Recent stock price movements have been quite volatile, an aspect that potential investors should consider. Despite this volatility, Ford has demonstrated a strong return over the last three months, with a 21.52% increase, suggesting a positive trend for the stock. Additionally, the stock is trading near its 52-week high, at 98.97% of the peak value, reflecting the market's optimistic view of the company's future.
For those interested in gaining deeper insights and additional analysis, there are 15 more InvestingPro Tips available at: https://www.investing.com/pro/F. To access these valuable tips and take advantage of real-time metrics for Ford, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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