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Ford’s (F) Sales in China Surge 24% Y/Y in September


Ford Motor Co.’s F shares fell 1.1% to $11.99 on Oct 11 due to the overall market movement even as the company and its joint ventures’ China sales (including Lincoln) improved 24% year over year in Sep 2016. Sales increased 11% to 879,559 units in the first nine months of 2016. The sales volume was driven by strong demand for the expanded SUV lineup.

Notably, Lincoln sold 20,996 vehicles in the first nine months of 2016, marking a 191% surge from the prior-year period.

Ford’s passenger car joint venture, Changan Ford Automobile (“CAF”) recorded a 25% year-over-year increase in vehicle sales to a record 84,335 units in Sep 2016. Also, CAF sales rose 14% year over year to 663,282 units in the first nine months of 2016.

Ford's commercial vehicle investment in China, Jiangling Motors Corporation (“JMC”), sold a record 23,416 vehicles in Sep 2016. Notably, sales improved 28% from the figure recorded in Sep 2015. JMC sales were nearly constant year over year at 182,629 vehicles in the first nine months of 2016.

In Oct 2015, Ford announced its plan to invest nearly 11.4 billion yuan ($1.8 billion) for research and development in China over the next five years. The automaker has been trying to enhance its sales in the Chinese market by modifying its vehicles to meet consumer preferences. As a result, it has gained significant market share over the last few years. Ford plans to expand its portfolio of hybrid, plug-in hybrid and electric vehicles in the nation over the next few years.

Ford currently carries a Zacks Rank #5 (Strong Sell). Some better-ranked auto stocks include The Goodyear Tire & Rubber Company GT, Tata Motors Limited TTM and SORL Auto Parts, Inc. SORL, all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Goodyear has witnessed positive estimate revisions over the last 60 days. It also posted positive earnings surprises in the last four quarters, with an average beat of 10.28%.

Tata Motors has a long-term expected growth rate of 3.6%.

SORL Motor Parts has posted an average positive earnings surprise of 7.46% over the last four quarters.

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