The Ford F-150 is America's favorite pickup truck, actually,
scratch that, it is America's favorite vehicle, full stop.
SUVs might be the talk of the automotive industry, but the
F-150 is still the strongest selling model of any kind in the
United States. It is also the product that many say keeps the
lights on at Ford.
The F-Series line of full sized trucks sells so well in the
U.S. that in 2019 it outsold all of rival GMs full sized trucks
by 11%.
That includes both the Chevrolet and GMC brands.
But the F-150 needs to stay on top.
Due to some steep US taxes on imported trucks, a loyal and
patriotic customer base, and to be fair, very strong products.
Americans dominate the domestic truck market.
Toyota and Nissan, for example, do sell pickups in the U.S.,
but more than 80% of sales go to Ford, General Motors, and Fiat
Chrysler. And yet competition is fierce.
General Motors is still a formidable competitor.
And Fiat Chrysler's RAM brand has been ratcheting its way up
from third place to vie for second among brand names with GM's
Chevrolet. Pickup sales are growing and automakers are carving
out niches in the market, hoping to scoop up a few more buyers
here and there. And, of course, the electrification trend is
penetrating the truck market as well.
Not only are these so-called Big Three competing with each
other, a new crop of truck makers such as Tesla and Rivian want
to be the brands present and future generations turn to for
their everyday workhorses.
Ford is also becoming ever more dependent on sales of large
SUVs and trucks and on North American customers.
Unfortunately for Ford, its Detroit rivals are in a similar
position. In 2020, the second largest U.S.
automaker was still in the midst of a multiyear turnaround plan
and had just appointed its third CEO in six years.
During this time, Ford also began rolling out the latest
generation of its market leading and profitmaking F-150, which
it needs now more than ever.
Ford's earliest pickup was basically just a chassis or vehicle
frame that was strong and large enough to accommodate third
party truck beds.
I think Ford saw the potential of trucks earlier than anyone
else. On July 27th, 1917, Ford released the Model TT a
chassis and cab that was based on its Model T sedan.
The Model TT came with a heavier duty frame capable of carrying
one ton of payload.
The factory price was $600, 209 were sold that year.
F-Series debuted in 1948.
The line had an alphanumeric naming system like today, but then
the half ton was just called F-1.
The F-1 was later called the F-100.
The 1950s were the years when Ford began dressing up its
pickups a bit. It included amenities many would now consider
standard, but were unusual at the time for a utility vehicle
armrests, dome lights, and sun visors.
The F-150 didn't come out until 1975, when Ford beefed up its
pickup to compete with new trucks from General Motors.
Two years later, F-150 was the sales leader in the segment.
Really by the late 70s, early 80s, Ford had cemented that role
as not just the best selling truck in the truck market, but the
best selling vehicle in the entire U.S.
market. And it never has relinquished that.
The late 1970s were also a time when truck owners began to see
their trucks as more than work vehicles.
In 1978, Ford introduced its Lariat trim package, which again
included features any buyer today would consider basic.
The F-Series Super Duty models began rolling out in 1998 to
serve customers and businesses in need of bigger trucks.
Over time, F-Series has continued to fill out its offerings at
the higher end of the truck market as truck buyers opt for more
luxurious interiors, dazzling technology, and aggressive
performance. It was a purpose driven vehicle at that point in
time, and the big, amorphous shift that happened over time is
it went from a purpose driven vehicle to get a job done to a
prestige vehicle to be seen.
Throughout its history, Ford's F-Series has grown in sales.
In 1983, Ford sold 450,108 full size pickups.
By 2019, that number had roughly doubled to 896,526.
The F-Series has been the leading lineup of trucks in America
for a long, long time, but Ford knows it can't surrender its
leading position. F-Series is widely regarded as Ford's profit
machine. So Ford has brought forth a number of innovations to
keep convincing buyers they are purchasing the true market
leader. For example, over the years, the company has made a
name for itself in specialty trucks with fast and quick pickups
like the now discontinued SVT Lightning and off road beasts
such as the Raptor.
Trucks like these are basically F-150 trucks with tweaked
engines, brakes, suspensions, and other parts.
The Blue Oval has also had to innovate to keep up with
regulations and a truck buyer looking to hold down fuel costs.
In 2011, Ford debuted its EcoBoost Engine, a highly efficient
six cylinder engine that could deliver power when needed and
rationed gas the rest of the time.
EcoBoost technology is now found across the board on Ford
models, but getting the truck world to accept it took some
persuasion. The preferred engine for a full size truck had long
been an eight cylinder, and Ford's V8s have long been
legendary. There was a great deal of skepticism that an engine
with two fewer cylinders could match V8s in power and
performance. But the EcoBoost proved successful.
F-150s can still be bought with V8s, but Ford says the EcoBoost
engine has the highest take rate among Ford buyers.
Ford also took a risk in 2015 when it rolled out a completely
new F-150 with an aluminum body, the first in the business.
Aluminum being far lighter than steel, Ford said the reduced
weight would improve further fuel mileage.
The aluminum body is about 700 pounds lighter than steel
versions. And again, a lot of skepticism.
But here we are, five years, six years after that truck hit the
market and no questioning of the strength and durability of the
aluminum version of the F-150.
The truck remains the best seller.
And the aluminum has not proven to be any form of a weak spot
for the vehicle.
Of course, Ford trucks are not without their critics.
Reliability and quality surveys have been mixed.
Consumer Reports gives the F-150 a predicted reliability score
of one out of five.
However, the F-150 did quite well in J.D.
Power's 2020 vehicle dependability study and initial quality
study. There's also competition.
All three American carmakers increasingly rely on pickups and
large SUVs for their profits.
Competition from foreign automakers is a lot fiercer.
Among smaller vehicles, General Motors and Fiat Chrysler are
both leaning into the segments where they are strongest.
Fiat Chrysler's RAM brand has been something of a dark horse in
the truck wars as of late.
It wowed the truck world with its 2019 RAM 1500, a pickup that
won multiple awards and sold like crazy.
Industry insiders praised Ram's lush, high end interior
packages and its adoption of tech features, such as a 12"
touchscreen display embedded in the dashboard.
Ford has also had to fend off challenges from GM, which has
notched a few big innovations of its own in recent years.
For the 2020 model year, GM debuted a 2.7 liter turbo four
cylinder engine on its Chevrolet Silverado, which is more
powerful than the V6, despite its smaller size.
GM's premium truck and SUV brand GMC has offered all kinds of
gadgets on its trucks that have impressed the market, including
cameras that can give a view of objects behind the vehicle the
truck is towing and a multifunction tailgate that can be folded
into a workbench or a step into the bed.
GMC has also been the first to debut carbon fiber beds on its
trucks, which it says are lighter, stronger and more impact
resistant than steel or aluminum.
The aluminum body introduced on the previous generation, F-150,
was big news, so some of the changes to the vehicle this time
around might seem a bit less ambitious.
They're claiming that something like 90 plus percent of the
vehicle's new. But whether it's the styling or the drive
trains, it still feels largely carryover.
But you do have some some interesting innovations.
Importantly, there is an optional hybrid version of the F-150,
perhaps the biggest news for this redesign.
Ford has said it is stressing the power and performance
benefits of hybrid vehicles rather than ecological ones.
The hybrid version does get better gas mileage than other
F-150s. But Ford wants to remind buyers of the excellent low
end torque electric motors can produce, which makes hybrids
good options for towing or moving over steep or uneven terrain.
And what we're most excited about that is targeting over 700
miles of range with the PowerBoost and targeting over 12,000
pounds of towing. So, again, you get the benefits of improved
fuel economy, but at the same time don't have to give anything
up from a capability stand point. The F-150 has an array of
tools for towing, including a trailer backup assist feature
that drivers can control via a dashboard knob.
Cameras on the truck also help with steering.
There is even a steering guide that tells drivers which way to
turn the wheel. There are a number of features for customers
who use the truck for work, including a work surface on the
tailgate with rulers and holsters for mobile devices, a cup and
a pencil. There are also clamp pockets on the sides of the
tailgate for securing materials.
At least some versions of the F-150 come with some pretty
cutting edge tech features that appear to be aimed at that
growing segment of higher end truck buyers looking for plush
interiors full of gadgets and comforts.
We'll be the first full size pickup in the US that will offer
over the air update standard.
So this is an opportunity for us to improve the function and
feature capability as our customer goes through the ownership
cycle. There are also some available options for the truck that
show Ford is aiming at cabin comfort, such as fully reclining
seats and a 12" touch screen, a shot right at the one offered
in the 2019 Ram.
Being Ford's breadwinner F-Series is a product line Ford is
extremely careful with.
I think it's fair to say that no other automaker is as closely
tied to the success of its truck as a definition of the success
of the automaker than Ford and the Ford F-150.
Like many automakers, Ford has been hit hard by the coronavirus
with production pullbacks and at least temporary demand
slowdowns. Of course, one bright spot for automakers has been
that the pickup truck market suffered a lot less during the
Covid-19 pandemic than did other segments.
The second largest U.S.
automaker has also undergone some big changes at the top in
recent months financial results for 2019 and the last quarter
of that year were deeply disappointing.
In February 2020, the company said that Joe Hinrichs, a then 53
year old top executive who had been on many industry shortlists
for a future job as CEO of Ford, abruptly announced his
retirement. Henrik's went on to take a board seat for an
autonomous driving technology company called WaveSense.
Then CEO Jim Hackett who had taken the job in 2017, abruptly
announced his retirement in August 2020.
Hackett's successor is Jim Farley, another top Ford executive
who had been serving as the company's chief operating officer
before taking the helm.
Ford is struggling in its international segments.
It's having a hard time in Europe, a region GM exited entirely
in recent years, and in China, which is considered a key market
for global automakers.
But one where doing business is not easy, especially with trade
tensions between China and the U.S.
There have been some bright spots.
Ford is keeping up with the ever growing electric vehicle trend
with its Mustang Mach-E electric crossover.
The company's new Bronco off-road SUV has garnered praise for
its design, engineering, and innovative features.
Its North American business remains strong, thanks in large
part to the F-150.
The test for the company now is seeing if it can keep it that
way.