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Ford Calls Off Focus Active Launch in US on Hiked Tariffs
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Ford Motor Company (F - Free Report) has scrapped its plan to sell China-manufactured Focus Active in the United States, per Reuters. The plan to not import Focus Active has been taken to safeguard the company from higher U.S. tariffs.
The crossover, Focus Active was introduced in April for the global markets. Intended to launch the model as a niche product in the United States, Ford would have set the starting price at around $20,000. This pricing would have let the company witness a thin profit margin, making it difficult to absorb additional import duties. Per management, increased tariff rates would have led to augmented costs for Ford. However, its plan to introduce Focus Active in Europe and China will continue as planned.
The decision by the company has been announced at a time when the trade war between the United States and China is escalating. The U.S. government has already imposed a tariff of 25% on China-manufactured vehicles. Further, based on national security grounds, the government is assessing a proposal to enforce tariffs on all imported vehicles.
Almost 95% of the Ford vehicles sold in the United States are manufactured in the country itself, along with Canada and Mexico. Except for this, its EcoSport small sport utility and Transit Connect small vans are manufactured in India and Spain, respectively. Currently, Ford is not extensively exposed to risks due to vehicles produced outside the United States.
In the last month, General Motors Company (GM - Free Report) filed a tariff exemption request for its Buick Envision utility vehicle produced in China. Per the filing, importing the China-manufactured model in the United States enables the company to compete against its counterparts. In 2017, Buick Envision’s U.S. sales were 42,000 units compared with China’s number of 210,000 units. The minuscule U.S. sales will not support shifting the factory location to the United States.
Price Performance
In the past three months, Ford’s stock has lost 19.2%, underperforming 8.1% decline recorded by the industry it belongs to.
PACCAR has an expected long-term growth rate of 10.8%. Over the past month, shares of the company have gained 5.4%.
Navistar has an expected long-term growth rate of 5%. Shares of the company have risen 3.1% in the past month.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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Ford Calls Off Focus Active Launch in US on Hiked Tariffs
Ford Motor Company (F - Free Report) has scrapped its plan to sell China-manufactured Focus Active in the United States, per Reuters. The plan to not import Focus Active has been taken to safeguard the company from higher U.S. tariffs.
The crossover, Focus Active was introduced in April for the global markets. Intended to launch the model as a niche product in the United States, Ford would have set the starting price at around $20,000. This pricing would have let the company witness a thin profit margin, making it difficult to absorb additional import duties. Per management, increased tariff rates would have led to augmented costs for Ford. However, its plan to introduce Focus Active in Europe and China will continue as planned.
The decision by the company has been announced at a time when the trade war between the United States and China is escalating. The U.S. government has already imposed a tariff of 25% on China-manufactured vehicles. Further, based on national security grounds, the government is assessing a proposal to enforce tariffs on all imported vehicles.
Ford Motor Company Price and Consensus
Ford Motor Company Price and Consensus | Ford Motor Company Quote
Almost 95% of the Ford vehicles sold in the United States are manufactured in the country itself, along with Canada and Mexico. Except for this, its EcoSport small sport utility and Transit Connect small vans are manufactured in India and Spain, respectively. Currently, Ford is not extensively exposed to risks due to vehicles produced outside the United States.
In the last month, General Motors Company (GM - Free Report) filed a tariff exemption request for its Buick Envision utility vehicle produced in China. Per the filing, importing the China-manufactured model in the United States enables the company to compete against its counterparts. In 2017, Buick Envision’s U.S. sales were 42,000 units compared with China’s number of 210,000 units. The minuscule U.S. sales will not support shifting the factory location to the United States.
Price Performance
In the past three months, Ford’s stock has lost 19.2%, underperforming 8.1% decline recorded by the industry it belongs to.
Zacks Rank & Key Picks
Ford currently carries a Zacks Rank #5 (Strong Sell). A few better-ranked stocks in the auto space are PACCAR Inc. (PCAR - Free Report) and Navistar International Corporation , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
PACCAR has an expected long-term growth rate of 10.8%. Over the past month, shares of the company have gained 5.4%.
Navistar has an expected long-term growth rate of 5%. Shares of the company have risen 3.1% in the past month.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>