- Company sees aluminum-bodied truck generating big profits
- First redesign in 18 years includes driver-assist technologies
Ford Motor Co. has begun shipping its new aluminum-bodied Super Duty pickup, one of its most profitable models, from a Kentucky factory, the automaker’s top North American executive said.
“This is one of the strongest products in our portfolio,” Joe Hinrichs, Ford’s president of the Americas, said in a presentation Tuesday at a JPMorgan Chase & Co. conference in New York. “This is the first all-new Super Duty in 18 years.”
The second-largest U.S. automaker said last month that its profit goals for the year are at risk because it no longer sees the U.S. vehicle market growing. The cost of introducing the new Super Duty pickups, such as the F-250, was already going to pressure margins in the year’s second half, Ford had said. But rising incentives and slowing sales are also taking a toll, as Ford’s North American pretax profit slid 4.8 percent in the second quarter to $2.7 billion.
The Super Duty, which began shipping this past weekend, will eventually provide some relief, once Ford gets through the costly launch phase when it’s spending to overhaul the factory in Louisville, Kentucky, and market the new truck. The automaker rolled out an aluminum-bodied version of its smaller F-150 pickup over the last two years, which can be seen as a guide to how Super Duty will eventually improve profit, Hinrichs said.
“There certainly are costs associated with the launch period,” he said. “Once we got past the F-150 launch, we set a record for every quarterly profit.”
Ford rose 1.2 percent to $12.32 at 1:17 p.m. in New York. The shares declined 14 percent this year through Monday.
The Super Duty accounts for 43 percent of the U.S. heavy-duty pickup market, making it the leader of that segment, Hinrichs said. The new version, with its lightweight aluminum body, will have the best fuel economy in its class. It also will have 17 new features, including driver-assistance technologies, he said.
“Super Duty is a very, very important product,” Bob Shanks, Ford’s chief financial officer, told analysts last month. “It’s high volume. It’s very high margin.”
The U.S. auto market slowed sooner than Ford anticipated. The automaker now sees U.S. industrywide sales of 17.4 million to 17.9 million vehicles, down from an earlier forecast of about 18 million. Excluding medium-duty and heavy trucks, the new projection translates to a light-vehicle market of 17.1 million to 17.6 million, compared with last year’s record 17.5 million.
Although Ford’s incentives have risen this year, Hinrichs said the company will remain “very disciplined” in its pricing. The restructuring during the last recession, in which Ford closed factories and cut jobs, has left the company prepared for the next downturn, he said.
“We feel good about where the North American business is,” Hinrichs said. “We still believe we can be profitable in a downturn.”