Ford (NYSE:F) has done an incredible job over the past few years producing popular new designs around the globe and across multiple vehicle segments. Ford arguably now boasts a more balanced vehicle lineup than ever before. That said, Ford's F-Series is the company's most important vehicle hands down. If the world gave away a "Most Valuable Player" award in the automotive industry, Ford's F-Series is the LeBron James or Peyton Manning comparison.
Currently Ford's F-Series is the No. 1-selling truck for 37 consecutive years, and it's about to shake up the industry with a more revolutionary approach to its next-generation F-150, which will be unveiled next week at the North American International Automotive Show, in Detroit. Here are two things investors and car enthusiasts should be looking at when it hits the showroom.
Concept to production
The first thing we need to look at in depth is what changed between the Atlas concept, which surprisingly popped up at last year's show, and a more production-type model F-150. Typically, concept vehicles are loaded to the max with features and innovations that don't make it to production because of high cost or lack of perceived value. However, Ford has a track record of not overextending too far with its concept designs, and for that reason analysts are expecting the Atlas' more aggressive exterior look to remain.
The Atlas concept was absolutely loaded with features and a much more rugged look on its front grille. While it's likely we'll see a new EcoBoost power-train, rumors of a 2.7-liter V-6 that approaches 30 mpg are swirling, other features like active grille shutters and wheel shutters that close during high speeds to boost fuel mileage might not make the production model. Hidden cargo ramps, power running boards, an LED cargo box, side mirror lighting, and a 360-degree point-of-view camera may all be axed from final production or added to a list of possible features if consumers are willing to pay up for premium trims.
Going from concept to production models is a big change. Investors and car enthusiasts both should take a close look at what the F-150 really is -- but expect nothing short of impressive. However, aside from all the features that might not make the cut, Ford plans on replacing a significant amount of steel with aluminum, and that will be the most important factor when it's unveiled next week.
Aluminum sales pitch
The NAIAS show in Detroit is big -- very big. It's the most important automotive show in the world, and countless vehicles look to take the spotlight, as do executives from all the major automakers. More than 5,000 automotive analysts and journalists will make the journey to Detroit, with more than 750,000 hungry consumers eager to see what cutting-edge vehicles are about to be unveiled.
Ford is taking a huge risk by replacing steel with aluminum, with the aim to reduce the F-150's weight by as much as 750 pounds. This will be extremely important to boost Ford's fleetwide miles per gallon, which needs to be 54.5 mpg by 2025, because the F-Series represents roughly a third of the company's sales in the U.S. market. The trick will be convincing the working class, which uses Ford's trucks as tools, and the general population that aluminum's perception of being weak and flimsy won't hinder the F-150's toughness or durability. If consumers remain unconvinced, it could put a serious dent in F-Series sales and leave the door open for the Silverado to gain valuable market share in the world's most profitable segment.
The first step in battling aluminum's weak image will be convincing all 5,000 automotive journalists and 750,00 consumers at the show next week that its new F-150 is less like an aluminum soda can and more like a bulletproof military vehicle -- so expect to hear details, specifics, and convincing sales pitches.
"This is already the most significant debut at the auto show," said Joe Langley, a production analyst for researcher IHS Automotive, according to Automotive News. "Everybody's going to be dissecting that thing for a long time, especially since Ford will be taking such a big gamble."
If Ford can convince the public its additional aluminum doesn't take away from the F-150's performance capablities and durability, it will only be the first victory in a longer war.
Aluminum is much more difficult to work with, and industry experts believe using the new material will change how the trucks are produced on the assembly line. Moreover, rumors are spreading that suppliers of Ford's aluminum panels are already behind, which could lead to costly delays and budget overruns; that's essentially nails screeching on a chalkboard for investors already coming to grips that 2014 will be less profitable as Ford launches more than twice the amount of new vehicles this year, compared with 2013. One thing is for sure: Next week will be huge for Ford, as well as others at the NAIAS show, and I fully expect the F-150 to deliver on its revolutionary design promises.