Boston, MA 01/14/2013 (wallstreetpr) – Ford Motor Company (NYSE:F) exited 2013 buoyed by huge vehicles sales across most of its global markets, a stellar performance that is being attributed to the success of its pickup trucks. The company is now looking at 2014 with a lot of optimism and it is not just plotting to make more sales, but also producing vehicles which answer customer preferences and comply with the U.S. fuel economy regulations.
Towards this end, the company is switching to use aluminum for its new trucks instead of steel that it has been using previously. This change will feature in the 2015 Ford F-Series which is expected to hit showrooms by end of 2014.
The new F-Series will be 700 pounds lighter that its predecessor made from steel. The company expects to encounter some challenges in making around 800,000 pickup trucks of aluminum given that it will be the company’s first shot in big volume aluminum manufacturing for trucks.
Nonetheless, 700 pounds out of a vehicle is such a big deal. The new F-Series featuring aluminum is expected to be lightweight and high strengthen given that value-added aluminum material like those produced by Alcoa (NYSE:AA) will be used for this purpose.
Reasons behind aluminum adoption
In manufacturing all-aluminum-based trucks, Ford Motor Company (NYSE:F) will become of the early automakers to lead in the switch to aluminum from steel in vehicle manufacturing. In fact, this switch to aluminum by automakers is expected to benefit aluminum stocks.
Ford is making this switch to comply with the so-called corporate average fuel economy (CAFE) or the fuel economy regulations. The redesign of the F-150 featuring aluminum makes it “CAFE-positive”. It is apparently easier for Ford to redesign its vehicles instead of lowering the average gas mileage of its vehicle platforms in complying with CAFE.
Yet another reason why Ford Motor Company (NYSE:F) is going the aluminum way is because customers have asked for lighter, harder and more fuel efficient trucks given the nature of their use.
Bottom line
That Ford Motor Company (NYSE:F) is seeking to use aluminum in its trucks makes a lot of sense for the aluminum industry that is already under pressure due to low demand in key markets. More and more automakers are expected to switch to aluminum and this will boost the performance of aluminum stocks.
