Ford Motor Company (NYSE:F) Rolls Out New F-150

The Ford Motor Company (NYSE:F) will begin production of the all-new F-150 today. This pickup truck has been a best seller for the Ford Motor Company (NYSE:F) for more than 30 years. During 2013, they sold 763,401.

The new version will be totally overhauled and they will be using military grade aluminum in replace of steel on the body panels. This change alone will reduce the vehicles weight by 700 pounds and in turn will reduce the amount of gas consumed and it will also offer greater towing and payload capacities.

Other features specific to towing capabilities of the new F-150 include an eight inch screen that is dedicated only to towing information. There will be a Dynamic Hitch Assist and the Smart Trailer Tow connector that will alert the driver to an unlit lamp on the trailer and any battery issues. The Standard Trailer Sway Control will help keep the trailer on a stable course and the TBC (Trailer Brake Controller) will synchronize the truck and the brakes on the trailer. The maximum towing capacity will be more than 12,000 pounds.

This total truck overhaul is huge financial gamble for Ford Motor Company (NYSE:F) because they will need to make major changes to their factories in Michigan and Missouri to produce this upgraded vehicle.

According to Ford Motor Company (NYSE:F), they estimate on losing 90,000 units of truck production while the factories are being retooled for the manufacturing of the new F-150. At an average cost of $40,000 per unit, that is a loss of over $3.5 billion in potential revenue.

So the question becomes: if it isn’t broken, why fix it?

Mark Fields, the CEO of Ford Motor Company (NYSE:F) explained that setting high standards is what responsible leaders do. When faithful customers where asked what they wanted in the trucks of their future, their response was fuel efficiency and more capabilities.

Alan Mulally, the longtime CEO of Ford Motor Company (NYSE:F) and the one who is credited with turning the company around after the auto crisis hit in 2009, passed the torch onto Mark Fields less than six months ago.

In response to the potential revenue loss, Mark Fields views the next 12 months as a building block for the next stage of growth for the company. He is quoted in saying that the best way to make up lost revenue is to build a smarter, tougher and more capable pick-up truck. Fields’ approach to growing a successful business is to invest in a great product that will be far above the competition.

Ford Motor Company (NYSE:F) announced disappointing earnings for the third quarter of 2014. Revenue was down $1 billion when compared to last year.

When the market opened, Ford Motor Company (NYSE:F) was 14.05 and at 1:05 pm eastern standard time, it is holding at 14.16 per share. The market capital is 53.82B with a 52 week outlook ranging from 13.26 to 18.12. The institutional ownership is 56%.