G

Sales of Ford's Mustang were on fire in November, rising over 60%. Dealers were selling the new-for-2015 pony cars almost as quickly as Ford could deliver them. Source: Ford Motor Co.

Ford Motor Company (NYSE:F) said on Tuesday that its U.S. sales fell 1.8% in November as the company dealt with tight supplies of outgoing pickup-truck models as it began shipping all-new versions.

The overall sales decline wasn't a surprise -- in fact, Ford very slightly beat the 2% average decline expected by Wall Street analysts polled by Bloomberg. 

And there was good news for Ford investors concerned about the company's complicated transition to its all-new pickup trucks: The very first 2015 F-150s were delivered to customers at the end of November.

A very strong month for pickup sales, but not at Ford
Overall sales of Ford's F-Series line, which includes the F-150 and its Super Duty siblings, were down almost 10% in November, while rivals General Motors and Fiat Chrysler each posted very big year-over-year gains in full-size pickup sales. 

That would be a huge red flag for Ford investors under normal conditions: The F-Series is the company's most profitable product line. But as Ford has been telling us for months, these aren't normal conditions. The body panels on Ford's all-new 2015 F-150 are made of aluminum alloy, a move made to improve the trucks' fuel economy and towing capacity by reducing weight. But building the aluminum trucks requires new tooling and production processes in the two Ford factories that make the F-150.

F

Ford's Dearborn Truck Plant has begun shipping the all-new 2015 F-150. Ford said the new truck's first retail sales happened at the end of last month. Source: Ford Motor Co.

Ford's Dearborn Truck Plant has already been converted to make the new vehicle, a process that involved a total of 12 weeks of downtime, and is now ramping up to full-speed production. Ford's other truck factory, near Kansas City, is still making 2014-model pickups now, but it's expected to shut down for conversion early next year. 

The upshot is this: For the next several months, Ford will be selling a mix of (old) 2014 pickups and (all-new) 2015s -- and working with less-than-ideal supplies of both. Investors should expect the Blue Oval's pickup sales to be subdued until after its Kansas City plant is up to full speed on the new F-150, sometime next spring.

But there are two points of good news for Ford investors. First is this: Ford's elaborate transition to making its all-new pickup -- a transition that could easily have gone wrong, with very expensive delays -- appears to be solidly on track. 

Second, even though the number of pickups Ford can sell in a given month is constrained by its need to manage inventories, the pickups it is selling are getting strong prices -- an unusual situation for an outgoing model. Outgoing vehicle models are typically discounted as production winds down. 

Ford sales analyst Erich Merkle said on Tuesday that the average transaction prices on the F-Series were over $40,000 last month, up about $2,100 from year-ago levels -- while its incentive spending was down about $300 per truck. That's a very strong performance that should help Ford's North America business unit preserve good profit margins as the year draws to a close.

Ford's other new models are doing very well
Meanwhile, Ford's other new-for-2015 models are selling well. Sales of Ford's all-new 2015 Mustang were up a whopping 62% in November, with new models selling after just eight days on dealer lots on average. That's an exceptionally short time, even for a brand-new model -- a sign that demand for the all-new Mustang is very high.

The all-new Lincoln MKC SUV is also selling well, helping Ford's old luxury brand to a 21% sales gain in November. Also doing well: The big Lincoln Navigator SUV, which has been refreshed for 2015. Navigator sales were up 88%, to 1,433 units. 

Images

Falling fuel prices might have helped sales of the big Lincoln Navigator SUV jump almost 90% in November. Source: Ford Motor Co.

But the news at Lincoln wasn't all good. A point of concern: The Fusion-based MKZ sedan, which has been a bright spot for Lincoln (and for Ford overall) over the last year, was down over 26% in November despite attractive "Black Friday" lease deals.

Ford officials say that the MKZ's one-month decline isn't worrisome and hint that they're losing some MKZ buyers to the new MKC. But it'll bear watching: If the MKZ loses momentum, it'll complicate Ford's attempts to make the Lincoln brand a significant player in the U.S. premium market.

The upshot: No big surprises as Ford's new-model barrage continues
Ford CFO Bob Shanks warned us way back in December that 2014 would be a year of transition for the Blue Oval, with profits for the year likely to be lower than 2013's $8.5 billion pre-tax result as Ford worked through the launch of the new F-150, the Mustang, and its other new models.

The good news for Ford investors is that the year has unfolded pretty much as Shanks told us it would, at least in North America. The Mustang and MKC have been launched to good reviews and are selling well, and the extremely complicated launch of the new F-150 is proceeding smoothly.

Ford U.S. Marketing VP John Felice said on Tuesday that 592,000 people have completed a "build and price" for the new F-150 on Ford's U.S. website, a very strong indicator of consumer interest. If that interest translates into strong early sales of the all-new pickup, Ford investors should have a lot to be happy about in 2015.

John Rosevear owns shares of Ford and General Motors. The Motley Fool recommends Ford and General Motors. The Motley Fool owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.