Ford January Sales Drop 5.3% as EV Deliveries Plunge 69%
Electric vehicle strategy faces mounting pressure after sales crash to 1,743 units
Ford Motor Company reported a 5.3% year-over-year decline in U.S. sales for January, as the automaker's ambitious electrification strategy faced a sharp setback with electric vehicle deliveries crashing 69.2% to just 1,743 units. The sales figures, released Tuesday, show total vehicle sales fell to 135,362 units compared with the same period last year, according to Wall Street Journal reporting.
The dramatic decline in EV sales represents a significant challenge for the $55 billion market cap automaker, which has invested billions in its electrification pivot. Combined electrified vehicle sales—which include both battery electric vehicles and hybrids—dropped 25% to 14,228 units, according to sales data analyzed by GuruFocus. The collapse comes as consumer demand for electric vehicles shows signs of cooling amid higher interest rates and ongoing concerns about charging infrastructure.
Ford's core truck business, traditionally its profit engine, also faltered. Truck sales declined 9.2% to 75,814 units, while SUV sales fell 2%. The broad-based weakness across nearly all vehicle segments suggests the automaker is facing pressure beyond just the transition to electric powertrains. The sales miss arrives with Ford's stock trading at an overbought technical level, with the Relative Strength Index at 75—a level that often precedes pullbacks.
The poor sales performance adds to mounting questions about Ford's electric vehicle strategy. The company had positioned itself as a serious challenger to Tesla in the EV market, but January's results highlight the difficulty of competing in a segment dominated by Elon Musk's company and facing increasing pressure from Chinese manufacturers. Ford's F-150 Lightning, once touted as a breakthrough electric pickup, has struggled to gain meaningful traction in the marketplace.
Analyst sentiment reflects this uncertainty. Of the 21 analysts covering Ford, the majority hold a neutral rating with 17 recommending hold, compared to just three buy recommendations and one sell, according to market data. The consensus target price of $13.76 sits just below Tuesday's trading price of $13.95, suggesting limited upside potential in the near term. Ford's stock has rallied 72% from its 52-week low of $8.11, bringing it close to its yearly high of $14.50.
Despite the January shortfall, Ford maintains strong fundamentals with a trailing price-to-earnings ratio of 11.8 and an attractive dividend yield of 4.32%. The automaker generated $189.6 billion in revenue over the trailing twelve months with an operating margin of 3.15%. However, the steep decline in EV sales underscores the execution risk in Ford's planned transition away from internal combustion engines.
The January results come at a critical juncture for the automotive industry. Legacy manufacturers are pouring tens of billions into EV development while simultaneously maintaining profitable gasoline-powered vehicle lines. Ford's ability to balance these competing priorities will be closely watched by investors in coming quarters. The company's next earnings report, expected to provide more detail on EV production targets and profitability, will be a key catalyst for the stock.
Institutional investors own approximately 65% of Ford's shares, indicating significant professional interest in the company's turnaround efforts. However, the combination of declining sales, technical overbought conditions, and analyst skepticism suggests the stock could face near-term pressure as investors reassess the automaker's electric vehicle strategy amid challenging market conditions.