“US New Auto Sales: Ford F-Series Pickup Truck Deliveries Drop; Ford Explorer Soars” – International Business Times, 3 March 2015

This past December, Ford rolled out its aluminum-body F-150 truck, the first of its kind for the company, but it seems like the new truck is just not cutting it: sales dipped for the car manufacturer’s F-Series truck line this February, and has put the company squarely behind its competitors.

Typically, the F-150 has the highest selling rate in the US; however, this February, overall sales dropped by two percent. Ford believes sales will continue to grow by 8 percent this year to 1.29 million units, compared to February 2014.

The Ford Transit light commercial vehicle and the Transit Connect compact panel van gave Ford trucks a four percent boost, even though the F-series line dropped by 1.2 percent. The Explorer full-sized crossover also gave the company’s stats a little nudge— the crossover jumped by 32 percent to sell 17,027 units.

It’s a shame that Ford’s F-150 isn’t selling as well as we’d hoped, since the company went through the entire process of shifting from a steel to aluminum body, which required new equipment and manufacturing processes. Obama has made this move a requirement for the automobile industry, mandating that manufacturers double new-car average fuel economy by 2025.

(From International Business Times)

Developed and Written by Dr. Subodh Das and Tara Mahadevan

March 4, 2015

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“Fuel-Efficiency Rules Are Already Raising Costs in Detroit” – Wall Street Journal, 22 January 2014

Even though GM and Chrysler have paid off their auto-bailout loans, they are still under the thumb of Uncle Sam; elements of Obama’s Climate Action Plan do not only extend towards power plants, but automakers as well. According to the Climate Action Plan, car companies’ products have to average 54.5 miles per gallon by 2025. This, however, requires huge design changes that are going to be a big blow to profit margins.

America’s best-selling vehicle, the Ford F150, is getting a complete redesign. from the inside out. It will be the first truck and large-volume vehicle to have an all-aluminum body, which will lower its weight and increase its fuel efficiency. Obama’s Climate Action Plan requires full-size trucks to have a better fuel efficiency, up to 30 mpg from the current 20 mpg.

Switching to aluminum, though better for the environment, is an expensive move. As we reported last month, converting to aluminum means higher material costs and new manufacturing machinery. While the price tag is high, Ford can’t fight the new regulations, and is instead doing all it can to effectively market the innovation behind its newly redesigned products, the F150 and Mustang—the latter redesign offers a never-before-seen turbocharged four-cylinder engine. Each sale of the redesigned F150 contributes an additional $10,000 to Ford’s bottom line.

GM, on the other hand, is creating a whole new midsize truck to meet Obama’s requirements, which they believe will be less costly. Chrysler, instead, is spending more on nine-speed transmissions and diesel engines.

Obama had hoped that the market for electric cars would increase; as a bid in that direction, an element of the Climate Action Plan allows automakers to acquire mpg credits for manufacturing zero-emission vehicles. However, the demand for electric vehicles is still low, proving that that kind of car is still a niche product. Pricing for electric cars start at $40,000 and only increase from there.

While it is always painful to have a winner and loser, the “materials selection war” (steel vs. aluminum) is a long-term societal consideration and climate change mitigation, where aluminum is the ultimate winner. These trends will force America to increase the recycling of post-consumer aluminum products—as opposed to landfill and scrap export—and to also increase the design and manufacturing of recycle-friendly alloys.

There is simply not enough expensive and energy-intensive primary aluminum capacity available to meet higher aluminum demand of 100 million, and growing, cars per year.

See also:
Will All-Aluminum Cars Drive Metals Industry?
A Clean Car Boom
GM Planning Strict Diet for New Pickup Trucks

Developed and Written by Dr. Subodh Das and Tara Mahadevan

February 12, 2014

Phinix LLC

Copyright 2013. All rights Reserved by Phinix, LLC.

www.phinix.net    skdas@phinix.net

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