joeb427
Well-Known Member
10%-12% off sticker in my area which is a suburb of Charlotte,NC. California may be more.So, let's take a look at what sales *could* be. We're going to make a few assumptions, and we're going to use some data that we know. For starters, the Ranger is being made at MAP, which recently underwent all sorts of new tooling in order to make the RWD Body on Frame Ranger instead of the FWD Unibody Focus. We also know that MAP runs a single shift, and that a couple months ago they said they were running over time. Let's assume that means either 6 days @ 8 hours, or more likely, 5 days @ 10 hours - they're both very close, so we'll just say 50hrs / week of production. Let's also assume the generic 60 sec line speed. I don't know exactly what it is, but most assembly plants fall between 50 and 70 seconds, you can go slower if you don't have enough floor space so you need to do a lot in each station, but there's only so much that you can do because you only have so much line space to provide parts to do the installs... And you can go faster, but most plants don't have an excess of space to spread it out, and it becomes more of a burden on the employee.
With that, we can assume they have the ability to make 600 a day, or 3000 a week, or 12,900 a month. That means that annual sales would be capped at 154,800 units. But that's assuming 100% uptime, even a good plant only achieves 95%, and this is a brand new vehicle architecture - they've had some time to figure it all out, but I would guess they're closer to 90% at this time instead of 95%. Which means monthly volumes maxes out at 11,610, and annual 139,320.
Okay good... we've figured out what Ford is targeting from a max sales perspective. That may or may not be what they're actually targeting for long term stability. But we do know that the industry targets a certain level of "days of inventory on lot," somewhere around 75 days. If they're selling 140k a year, that means they want 28,767 Rangers sitting on the lots on any given day... Some analysts have found that to be the targeted time on lot, balancing carrying costs of having the truck sit vs. availability to the customer.
I'm going to lump Jan, Feb, Mar into a single month of production, knowing that they were really slow and whatnot for all of that time period. So we have "4 months" of production thus far, or about 45,000 Rangers produced. I believe the Q1 results showed that they had sold 9k already, leaving 36k trucks available to purchase and to stock the lots. Even if we assume that only 5k a month (averaging the 9k for Feb/Mar) were sold for Apr, May, and June, that means 21k trucks are on the lots - still under the desired target. For reference, there are ~3k Ford Dealerships in the US (sorry Canada, I'm ignoring you) - which means that their target is an average of 7 Rangers per dealership ON THE LOT, available for a test drive, not sold, not retail ordered... sitting on the lot, available for you to drive and buy THAT day.
So, what does all of this mean? It means that Ford is still working towards building its inventory of Rangers. It means that they're not actively chasing sales. Which means that incentives haven't ramped up. Which means that monthly volumes haven't matched the expected volumes yet. Q2 results, due at the end of June, will provide us a greater idea of what the current dealer volume is (if they've sold 10k/mo that means that there's only ~6k on the lots, and they're still looking to build inventory... but if they've sold 3k, then they have their inventory, and Q3 should start seeing incentives and more sales). Once we know what the current dealer stock is, then we can start determining what the Q3 sales should be. The only time to really start worrying, is if the Q2 sales aren't high, indicating that they've reached the dealer stock level they want, and then Q3 sales aren't good, indicating that even with incentives, Ford is having a hard time pushing the Ranger. Then we can revisit this conversation. But until October, there's really not enough information to worry about it.
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