How Much Can China Success Add To Ford’s Bottom Line?
Ford Motor Company (NYSE: F) is a global leader in the pick-up truck and commercial van market. According to the company, it leads the global pick-up truck market in terms of unit sales with its F-series pick-up trucks and the European and U.S. commercial vans market with Ford Transit, with the Ford Ranger positioned third in the same market. While Ford sells over 6 million units of vehicles each year, an outsize proportion of its profits is contributed by the sales of these three vehicles.
The company is vying for a leading position in the commercial vehicles market in the world’s biggest car market China as well. This is highly important for the company as commercial truck sales are extremely profitable and have extremely loyal customers. The table below estimates the potential increase to Ford’s stock price if it can assume the leading position in the Chinese market with these three vehicles as well. The table below models a scenario in which the market share of Ford in the SUVs and trucks market increases from 2.95% in 2016 to around 4.0% in 2020. The impact of this increase is clearly visible in the EPS estimate, which increases from 93 cents in 2016 to around $ 1.66 in 2020, an increase of close to 70%.
Have more questions about auto companies? Click on the links below:
- How Do Automotive Luxury Brands Compare In Their Performance In China?
- How Does GM’s performance vary across geographies?
- How Do Auto Luxury Brands Compare In The US?
- What Is Driving Changes In Ford’s Annual Unit Sales?
- How Much Money Does Ford Make Per Car Sold?
- How Much Has GM Been Investing In Growth Opportunities?
- How Ford’s Unit Pricing Differs Across Geographies?
- How Much Has Ford Been Investing In Growth Opportunities
- Ford’s Overwhelming Dependence On North America
- How Much Profit Does Ford Make Per Unit Sold In Each Geography?
- How Different China Growth Projections Impact Ford’s Bottomline
- How Ford’s Poor Russia Performance Is Obscuring Gains Made In Rest of Europe
- How Careful Targeting of F-Series Sales Helped Ford Boost Its Profits
- How Honda’s Automotive Business Is Faring In Japan
- The Most Significant Trends For Honda Motor Company
- Honda’s Brand Image Is Changing In The U.S.
- How Honda’s Automotive Performance Differs Across Geographies
- How Much Has Honda Been Investing In Growth Opportunities
- How Differing Japan Growth Projections Impact Honda Motor Company
- What’s Driving Toyota’s Unit Sales Growth In The U.S.
- What’s Driving Toyota’s Truck Sales In The U.S.
- Why Highlander Is The Most Important Vehicle For Toyota Right Now
- How Differing Japan Projections Impact Toyota Motor
- With F-150 EV Production Cut 50%, What Lies Ahead For Ford Stock?
- What To Expect From Ford’s Q3 Earnings?
- Will Strong F-Series Sales Power Ford’s Q2 Results?
- Can Ford Stock Return To Its Pre-Inflation Shock Highs
- Higher Truck Sales Will Drive Ford’s Q1 Results
- Ford’s Q4 Results Were Tough, But Things Could Get Better
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Ford Motor
See More at Trefis | View Interactive Institutional Research (Powered by Trefis) Get Trefis Technology