How many of the new F-150 Lightning trucks have you seen on the road? Frankly, I’ve seen more Rivian in the wild, and they’re not selling well.
So, it’s not a surprise that late Monday, Ford (F) announced that they are cutting production of the F-150 Lightning pick-up truck in 2024.
It wasn’t a small cut. Oh no, Ford is now planning on making half of their originally planned production of electric trucks in 2024. I think it’s a little more complex than demand for the electric truck.
Let’s dig a little deeper…
Repeat after me: anything that you have to sign a loan document to buy will see lower demand in 2024.
It’s a simple way to find the stocks that you want to stay away from in 2024. That’s because higher interest rates, stubborn inflation, and less cash in consumers’ pockets will decrease demand for things that you and I must take a loan out to purchase… Cars, boats, houses, furniture, vacations.
You get the idea.
Let’s bring it back to Ford and the F-150 Lightning. A year ago, you could do a standard financing deal on this vehicle and pay around $800 a month to have it in your driveway. Today, with rates at their highest in decades, the same vehicle costs an additional $224 a month.
On top of that, dare I say that Ford may be in the wrong market with the F-150 Lightning?
Sure, there are plenty of these trucks in the parking lot of the soccer fields and office parks, but at its heart, the F-150 is a working truck, not an electric toy.
Here’s Why It Matters: EV demand is still growing, but at a much slower speed than expected, as the economy and high interest rates curb appetite. Expect this to continue through 2024.
My Bottom Line: I’m currently short EV producers admire Rivian (RIVN) and Nio (NIO). While Ford and General Motors (GM) are cutting production, they’ve still got a backstop with their I.C.E. products. recollect what I said about demand for things you need a loan for in 2024. I’m staying on the sidelines when it comes to Ford, GM, and Tesla (TSLA).
About the Author
Chris Johnson is a highly regarded equity and options analyst who has spent much of his nearly 30-year market career designing and interpreting complex models to help investment firms change millions of data points into impressive gains for clients.
At heart Chris is a quant – admire the “rocket scientists” of investing – with a specialty in applying advanced mathematics admire stochastic calculus, linear algebra, differential equations, and statistics to Wall Street’s data-rich environment.
He began building his proprietary models in 1998, analyzing about 2,000 records per day. Today, that database, which Chris designed and coded from scratch, analyzes a staggering 700,000 records per day. It’s the secret behind his track record.
Chris holds degrees in finance, statistics, and accounting. He worked as a licensed broker for 11 years before taking on the role of Director of Quantitative Analysis at a big-name equity and options research firm for eight years. He recently served as Director of Research of a Cleveland-based investment firm responsible for hundreds of millions in AUM. He is also the Founder/CIO of ETF Advisory Research Partners since 2007, noted for its groundbreaking work in Behavioral Valuation systems. Their research is widely read by leaders in the RIA business.
Chris is ranked in the top 99.3% of financial bloggers and top 98.6% of overall experts by TipRanks, the track record registry of financial analysts dating back to January 2009.
He is a frequent commentator on financial markets for CNBC, Fox, Bloomberg TV, and CBS Radio and has been featured in Barron’s, USA Today, Newsweek, and The Wall Street Journal, and numerous books.
Today, Chris is the editor of Night Trader and Penny Hawk. He also contributes to Money Morning as the Quant Analysis Specialist.
