Ford's F-150 Lightning Launch: Morgan Stanley's Key Takeaways

Ford Motor Company F unveiled the F-150 Lightning electric truck earlier this week, joining a handful of companies that are working on EV trucks.

Morgan Stanley analyst Adam Jonas gave his takeaways on the vehicle launch in a note. The analyst has an Underweight rating on Ford with a $9 price target. 

The F-150 Lightning is priced lower than what Morgan Stanley had estimated, with the entry level model priced at $39,974 before taxes and incentives, Jonas said.

It is the among the very lowest priced battery electric vehicle offerings on the market in the pickup segment, the analyst said. 

The delivery timeline of spring 2022 is at least six months earlier than Jonas expected, he said. 

The F-150 Lightning's design is less radical than Jonas' expectations given that it borrows a lot from the design and basic body architecture of the current F-150.

The decision to keep it simple may have to do with having a fast time to market, reducing execution risk and a lower breakeven, the analyst said.

The price and some exclusive features make the trade-off worth it, he added.

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Jonas sees the vehicle helping the F-series for a measured de-adoption of ICE powertrain. Ford, the analyst said, is executing a balanced approach that includes a bold offering in terms of price and time to market, giving it a path to explore the electric truck market without pulling the rug out from under the ICE trucks.

Before the EV pickup space gets crowded, it is good for Ford to have a credible offering in the market, the analyst said.

Ford's F-150 Lightning will emerge as a major competitive threat to Lordstown Motors Corp. RIDE, according to Jonas. Apart from F-150 Lightning's competitive pricing relative to Lordstown's Endurance, the former's extensive commercial/dealer network and more proven technology place Lordstown at a disadvantage., he added.

Ford's memorandum of understanding to establish a joint venture with South Korea's SK Innovation shows that the company is on the right track to meet its requirement of 240 gigawatt-hours of batteries for the products it plans by 2030, the analyst said.

A home generator feature, Intelligent Backup Power, that Ford is providing in combination with Sunrun Inc. RUN is the showstopper, the analyst said.

The F-150 Lightning, the analyst noted, has the ability to supply 9.6 kW of power output which, depending on power rationing, could power a home for several days during an outage.

F Price Action: Ford shares were up 2.84% at $12.84 at last check Friday. 

Related Link: Sunrun Shares Rise On Ford F-150 Lightning Partnership: What Investors Should Know

Photo courtesy of Ford.