"Learning from the best": analysts have assessed Ford's plan for a low-cost electric pickup truck

Analysts have called Ford's plans for a new affordable electric pickup truck "promising". The model will be created on a universal platform, which will speed up assembly and reduce production costs. According to experts, this will help the company to strengthen its position in competition with Tesla and Chinese automakers.

The automaker plans to offer a new midsize four-door electric pickup truck in two years at a price of about $30,000. The new electric vehicle will be built on a universal platform that Ford expects to reduce parts count by 20 percent and assembly time by 15 percent. In addition, the company has transformed the traditional assembly line into an "assembly tree" in which subassemblies will be assembled separately, making the process faster and more efficient. For example, workers will no longer have to install seats through the car's doorways.

Analysts at BofA Securities said in a note that Ford is "learning from the best to offer innovation and a compelling product in the electric vehicle segment," MarketWatch writes. Two years ago, a similar strategy involving cost and time savings was introduced by Tesla - it called unboxed manufacturing.

According to BofA analysts, Ford has a competitive advantage in the pickup truck segment: the F-150 has been the best-selling vehicle in the U.S. for decades and it's logical that the company chose this particular body type for its cheaper electric vehicle.

"Ford is looking to the future rather than short-term trends with weakening electric vehicle sales. The company appears to be well prepared and can offer a competitive product for the next wave of electrification in both domestic and international markets," they said.

Ford's new platform, which will be adapted for the company's other electric vehicles, could potentially be used for cars with traditional engines as well, Tom Narayan of RBC Capital Markets said in a note.

The cheaper electric car is unlikely to be profitable in its first year of sales, he said. Ford, however, says the new electric car will be profitable within 12 months of launch

Deutsche Bank's Edison Yu believes Ford's reported profitability of the new electric car within a year of launch will be largely driven by revenues from related software and services.

"This will be key to making electric cars competitive not only against Tesla, but also in the global marketplace - against Chinese automakers," he wrote.

Overall, of the 26 analysts covering Ford shares, most - 17 - are now neutral and only four advise buying the automaker's securities (Buy and Overweight ratings). The analysts' consensus price target implies a 7% rise in the stock. Since the beginning of the year, Ford securities have added about 14%, exceeding the growth of the S&P 500 index, which amounted to 9%.

The first model on the new "universal electric vehicle platform" unveiled on August 11 will be a mid-sized five-passenger pickup truck due out in 2027. Ford claims it will be as fast as versions of the Mustang maslcar and offer more interior space than the Toyota RAV4, one of the world's best-selling cars, writes Barron's.

The company also plans to use more molded parts and make the battery pack a structural element of the car - solutions that Tesla is already using in its manufacturing.

"This is a bold and challenging endeavor to compete with the best in the world," said Ford's director of electric vehicles, digital technology and design, Doug Field,.

To realize the universal platform, Michigan-based Ford will invest about $5 billion, including $2 billion in Kentucky, which is estimated to create about 4,000 jobs, the publication writes.

Ford is standing out among traditional automakers by disclosing the financial performance of its electric vehicle division, Barron's notes. That segment, called Model e, recorded a $1.3 billion loss in the second quarter on sales of about 60,000 vehicles, up 128% from a year earlier. Loss per car - operating profit divided by the number of cars sold - fell to about $22,000 from $44,000 a year earlier.

The company has not disclosed profitability targets from electric vehicle sales, but getting the Model e segment to break even will depend on a combination of attractive models, sales growth and cost reductions, the publication notes.

Electric car sales in the US will get tougher: this quarter will be the last time buyers will be able to take advantage of a federal tax credit of up to $7500. The benefit was eliminated by the Tax and Spending Act, which US President Donald Trump signed into law on July 4.

This article was AI-translated and verified by a human editor