So legacy automaker Ford (F) showed off its “Model T Moment,” and investors were less than pleased. The idea seemed reasonable enough: a whole new way of making cars that would allow for more automation and potentially fewer employees. But investors were not having it, and sent Ford shares down fractionally in Monday afternoon’s trading.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Basically, Ford has a plan to fundamentally change its production lines, and bring out an entire class of new electric vehicles that will, at least somewhat, hold the line on price. The line will start in 2027, when a new $30,000 pickup truck in that line emerges. But it is not so much the truck that was the Model T Moment as it was the way it is produced. The platform in question will be scalable, reports note, and will be able to work with not only pickup trucks, but also vans and SUVs.
The process is being referred to as an “assembly tree,” and it takes its cues from Henry Ford’s original assembly line concept. In this case, the assembly tree will start with several different assembly lines working at the same time to feed a central assembly line. Essentially, it is assembly branches feeding an assembly trunk that should, ultimately, mean more cars produced faster with fewer people. In fact, reports note, the new “universal” vehicle platform uses 20% fewer parts than a typical vehicle, along with 25% fewer fasteners and 40% fewer workstations.
Spotting Minor Problems With AI
There is one thing that artificial intelligence (AI) does do surprisingly well. It spots little mistakes. And at Ford, workers are putting AI to use to find little mistakes before they can become serious problems, or worse, recalls. Ford rolled out two new systems, dubbed AiTriz and MAIVS, to help address such issues in Ford’s operations.
AiTriz, named for its creator Beatriz Garcia Collado in Spain, can catch misalignments down in the millimeter range thanks to a combination of video streaming and machine learning. Meanwhile, MAIVS, uses still images to spot incorrectly-mounted parts and warn production lines accordingly. These two systems in concert help catch issues before the car even leaves the plant, which can go a long way toward preventing recall notices later.
Is Ford Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Hold consensus rating on F stock based on two Buys, 10 Holds and three Sells assigned in the past three months, as indicated by the graphic below. After a 13.29% rally in its share price over the past year, the average F price target of $10.70 per share implies 3.95% downside risk.
