The new aluminum F-150 is quite a gamble for Ford and new questions are arising. Can Ford quell fears and bring this truck to market without complications? The future of Ford may be riding on it.
As we have previously reported, Ford’s use of aluminum is a big gamble with many obstacles in the way. Analysts have speculated on all sorts of problems such as insurance costs, repair facilities and whether customer’s will jump on board with the new metal alloy. These questions keep raising the stakes for Ford.
F-150 Production Idled
Ford has announced that it will idle its F-150 factories for 13 weeks while it implements the new aluminum production plan. Truck production will stop at the Dearborn Truck Plant in Michigan for 11 weeks. Work will also stop at the truck plant near Kansas City, Mo for two weeks. These figures include the traditional summer shutdown at both plants. By idling the plants, Ford can ensure a smooth transition for its new truck. This isn’t an unheard of process, yet it is just one more concern for the top-selling truck.
F-150 Insurance Premiums Higher
In recent weeks, it has been revealed that insurance rates are likely to raise by 10 percent or more with the new aluminum F-150 body. Ford counters this by saying that the fuel savings from its new F-150 truck will offset this increase. However, this will leave customers with a zero net increase over the current steel F-150 truck.
F-150 Repair Concerns
Also, repair facilities and centers will need to get new certifications to be able to work on the truck. Ford has claimed that by their estimates all of its customers will be able to find a repair facility nearby for the F-150. Yet the definition of “nearby” has rattled some. Ford’s internal data show that 90 percent of customers live within two hours of a capable repair facility for today’s F-150, and 80 percent are within 30 minutes. For the 80 percent this is good news, yet for the customers living in a rural area, the repair drive will be a hassle.
Dealers will be able to get certified, acquire the tools and become trained from anywhere between $30-50k. Ford says it will help offset that bill by up to $10k. Yet, the majority of the repairs will probably be to bumpers and grilles, not the body panels themselves according to work logs showing 80 percent of claims are for non-body issues. Also, there is speculation that the certification process could be either waived or the issue is simply being overblown by the media. The truth is that many trucks use aluminum hoods and shops already are preparing to work on the larger body panels.
The concerns about aluminum and the idling of plants has most speculating that Ford’s 2014 profits will diminish. However, the company posted a record $8.8 billion profit in 2013, so a decline in profit probably won’t hurt the company too badly.
What will hurt the company is if current F-150 customer’s don’t buy into the future of aluminum trucks. Ford has a long heritage of building a great truck and there is a lot riding on this new F-150. Never before has aluminum been used on the scale Ford is attempting and never before have customers been asked to really consider it (sorry Range Rover fans). With the many questions being raised in the last few weeks, the use of aluminum is certainly on people’s minds. Will Ford convince them that it is just as strong as steel? Can they calm customer fears about insurance rates and repair facilities? Maybe. If they don’t, Ford is in a world of trouble.
