Is Ford Blue Fueling Model e's Future in the Changing Auto Landscape?

Core Insights - Ford Motor Company is focusing on electrifying its product lineup through the Model e segment while leveraging the profitability of its legacy Ford Blue segment, which includes iconic internal combustion engine (ICE) models [1][4] Financial Performance - In the last reported quarter, Ford Blue segment's total wholesale volume decreased by 6% year over year to 588,000 units, surpassing expectations of 524,000 units [2] - Ford Blue generated revenues of $21 billion with an EBIT of $96 million, while Ford Pro and Model e reported revenues of $15.2 billion and $1.2 billion, respectively, in Q1 2025 [3] - Model e remains a loss-making segment, requiring capital-intensive investments funded primarily by profits from ICE vehicles [3][9] Strategic Outlook - Ford anticipates selling fewer ICE vehicles compared to the previous year, with a shift in product mix and foreign exchange headwinds expected to impact profits [5] - The Ford Blue segment continues to generate profits, maintain customer loyalty, and innovate in hybrid models, providing a strong foundation for Model e's EV and software-led business [4][9] Competitive Landscape - General Motors holds a 17.2% U.S. auto market share and has lowered its full-year 2025 guidance due to auto tariffs, but is progressing in its electrification efforts [6] - Stellantis plans to reassess its capital spending strategies, reducing EV production while focusing on traditional gas-powered vehicles due to ongoing market demand [7] Stock Performance - Ford shares have declined approximately 8.7% over the past year, contrasting with the industry's growth of 14.9% [8] - The company trades at a forward price-to-sales ratio of 0.26, below the industry average, and carries a Value Score of A [10]