In a surprising turn of events, the much-anticipated Ford F-150 Lightning electric pick-up is facing a significant downturn in demand, prompting a substantial reduction in production starting from January 2024.
Ford's Decision to Reduce Production
According to a planning memo obtained by industry publication Automotive News, Ford has confirmed its decision to halve the production of the F-150 Lightning in 2024 due to the plummeting demand for the battery-powered model in the US. A spokesperson for Ford stated, "We’ll continue to match production with customer demand," emphasizing the need to align manufacturing output with market needs.
The leaked document revealed Ford's intention to manufacture approximately 1,600 F-150 Lightnings per week, resulting in an annual output of about 83,000 units from the company's Michigan factory. This represents a significant decrease from the initial target of producing around 150,000 F-150 Lightnings annually, following recent upgrades to the manufacturing facility.
Reasons Behind Production Cut
This production cut marks the latest setback for the Ford F-150 Lightning since its launch in 2021. Despite an initial surge in demand that led to multiple price increases, sales have slowed down, prompting Ford to reduce output. The company also made the decision to eliminate one of the three shifts at the F-150 Lightning’s factory in October, impacting approximately 700 jobs.
While Ford attributed the production cut to various constraints, including supply chain issues and vehicle quality checks, reports from The Wall Street Journal suggest that declining sales are the primary driver behind the decision. A memo from a United Auto Workers union official expressed concerns about the weakening demand for the electric pick-up, indicating a clear downturn in sales.
Financial Impact
In light of these developments, Ford announced a postponement of its planned $12 billion investment in its electric-car division after incurring significant losses on each F-150 Lightning sold from July to September 2023. The company reported a staggering loss of $754.6 million from the sale of 20,962 battery-powered vehicles during that period.
Uncertainty and Challenges
The future of the Ford F-150 Lightning remains uncertain as the company grapples with adjusting production levels to align with market demand. The electric pick-up segment continues to pose challenges for traditional automakers, highlighting the complexities of transitioning to electric vehicle manufacturing amid evolving consumer preferences and market dynamics. As Ford navigates these challenges, industry observers will be closely monitoring the company's strategies and initiatives in the electric vehicle space.
(This article is sourced from drive.com.au and curated by Thetransporteronline24)
