Boston, MA 01/20/2014 (wallstreetpr) – Ford Motor Company (NYSE:F) sold many trucks than its rivals. It has always done this over the past 37 years and the company hopes that it can continue the trend. However, as the company talks about continuing the trend, it is important to look at how tweaks being made in the vehicle could affect its sales.
The company has announced that it would be using aluminum instead of steel in its future trucks. This makes sense in that aluminum is lighter than steel and it will result in lighter cars which are fuel efficient. The kind of aluminum material used in auto industry feature added-value in that they are extremely strong, durable and light-weight. Aluminum companies which supply this kind of material include Alcoa Inc (NYSE:AA).
Concerns
While value-added aluminum is a good idea especially now that fuel efficiency and environmental factors are discussed in the same breath. However, the fact that aluminum corrodes and that it is coming as a new concept in F-Series trucks can be an issue of concern for buyers. Hopefully the company is working on how to address this issue when the trucks hit the dealer showrooms this year.
Smaller engine trucks
Ford Motor Company (NYSE:F) is looking to ramp up trucks which feature 2.7-liter engine. This is quite a smaller engine size and it remains to be seen how the company will address this issues to customers. While fuel efficiency will have been addressed by this smaller engine, the resulting hauling power of the trucks may concern some buyers.
Key takeaway
Trucks sales have been the most rewarding business for Ford Motor Company (NYSE:F). In fact, its meteoric rise and escape of financial meltdown were linked to stronger sales in this vehicle platform. Trucks contribute about 40 percent of the company’s North America revenue.
The company is planning 23 new vehicle launches this year and several vehicle upgrades are also expected in 2014. Ford Motor Company (NYSE:F) is looking to China and India for its global expansion. Once again the company hopes that trucks and passenger vehicles will drive sales in these international markets.
As regards the issues of aluminum and smaller engine, the company should take an early opportunity to educate customers on the benefits of the proposed tweaks.
