Is Ford Losing the Reliability Race After Over 100 Recalls This Year?

Core Insights - Ford is recalling over 1.45 million vehicles due to faulty rearview cameras that may display blank or distorted images when reversing [1][10] - The recall affects 51 models, including popular vehicles like the Ford Mustang, F-250, F-350, Transit vans, and Lincoln models [2] - This year, Ford has issued more than 100 recalls, the highest among automakers, leading to significant warranty and recall expenses [3][4] Financial Impact - Ford's warranty costs have increased by 22% year-over-year in 2024, reaching $6 billion, largely due to repair campaigns [4] - In the last reported quarter, Ford incurred charges of $570 million related to a major recall for faulty fuel injectors in certain models [5] - The company is forecasting a loss of over $5 billion in its electric vehicle segment this year, exacerbated by unexpected recall costs [7][10] Reputation and Market Position - The frequency of recalls has raised concerns about Ford's quality control, potentially affecting consumer trust and purchasing decisions [6][11] - Ford's stock has gained around 10% over the past year, underperforming compared to competitors like Toyota, which is up 15% [12] - Ford trades at a forward price-to-sales ratio of 0.28, significantly lower than the industry average, indicating potential undervaluation [13]