business

Why is Ford stock in the spotlight today?


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Ford (NYSE:F) just announced a leadership change in hopes of bolstering product creation and transforming global supply chain management. This news comes at a time when Ford stock has not performed very well.

The automaker has announced a series of changes in response to the current business environment. Specifically, it comes just days after Ford said it expects about $1 billion in unexpected supplier costs for the third quarter. The news broke on Tuesday, September 20, with shares falling more than 12% during the session.

So what changes is Ford making to combat the situation? A few of its major changes include:

  • Current CFO John Lawler “will oversee the redesign of Ford’s global supply chain operations on an interim basis until a global supply chain director is selected.”
  • Doug Field, who is the current Director of Electrical and Digital Systems, will assume an “expanded role as Director of Advanced Product Development and Technology.
  • Roz Ho from resume (NYSE:HPQ) and Jae Park from alphabetical (NASDAQ:GOOG, NASDAQ:GOOGL) Google joins Sammy Omari of emotional and Rob Bedichek, who worked for Intel (NASDAQ:INTC) and Apple (NASDAQ:AAPL). Together, they will help Ford create more connected and advanced vehicles.

The way forward for Ford Stock

It’s a well-known and persistent problem since the pandemic that automakers have been grappling with supply chain issues. Still, that leaves investors wondering where to go with Ford shares.

The transition to electric vehicles (EVs) has been a bumpy one for many automakers. Stock market volatility over the past 30 months hasn’t helped, nor have supply chain issues. Ford, however, was relatively successful with its plans.

The electrification of the nation’s best-selling vehicle, the F-Series pickup, puts Ford in an immediate position to benefit from the electric vehicle trend. His Mustang Mach-E and E-Transit are also solid strategic moves.

While these decisions are great for the company’s long-term trajectory, investors are concerned about short-term volatility.

Unfortunately, we see how it is happening now. Continued inflation and supply chain disruptions are causing major problems for American businesses, especially automakers. Until this situation improves, Ford shares may struggle to gain traction.

That said, let’s not forget how good the shares are were do until recently. Ford stock had recently rebounded nearly 60% from the low. While the stock markets have been very choppy lately, an improvement in the stock market and in the company’s supply chain could push shares higher still.

As of the date of publication, Bret Kenwell had (neither directly nor indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com publishing guidelines.

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