Jim Farley really wants to make Mustangs.
The Ford (F) – Get Ford Motor Company Report CEO laid out the company’s goals for Mustang Mach-E, the electric version of the classic pony car in a tweet late last year.
‘The Incredible Demand’
“It’s hard to produce Mustang Mach-Es fast enough to meet the incredible demand, but we are sure going to try,” Farley said in December. “So starting in 2022 we are increasing production and expect to reach 200,000+ units per year for North America & Europe by 2023. That’s 3x our 2021 output.”
Sales for the Mach-E were so strong in the US that the automaker said retail order banks are closed for mid-year 2022 “due to unprecedented demand.”
“We will continue to sell the limited number of units remaining from dealer stock,” a Ford spokesperson told TheStreet in an emailed statement. “We will communicate MY23 ordering details as soon as available.”
Mach-Es might be scarce in the US but the vehicles are available in Europe. A review of Ford’s European site found Mach-Es in stock.
The spokesperson noted that Ford is planning to use the entire Cuautitlan, Mexico plant for production of Mustang Mach-E and increase production starting this year.
The spokesperson confirmed that the carmaker expects to reach 200,000 units per year in 2023. Ford won’t thus increase production despite the high demand.
Companies have been struggling with supply chain issues that were ignited by the Covid-19 pandemic.
And the global supply chain could take another hit as China continues its zero-Covid policy that has caused food shortages in Shanghai, home to the world’s largest port.
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Several comment on Twitter have posted a map displaying scores of commercial ships waiting offshore.
There have been reports of the city’s residents screaming from their balconies.
City officials have pleaded for public cooperation with a massive new push to test most of the population for Covid-19, Reuters reported.
China is currently the US’ largest goods trading partner, according to the Office of the United States Trade Representative. In 2020, the US imported about $435 billion worth of goods from Chinese cities, and sent another $125 billion to the country in exports.
On Monday, Commerce Minister Wang Wentao met with representatives from the US and other countries to discuss the impact of Covid controls, Bloomberg reported.
Raw Material Volatility
Chinese officials vowed to work with international businesses to resolve supply chain issues, while also reiterating Beijing’s stance on maintaining its Covid Zero approach
Raw materials are also an issue for automakers and the Ford spokesperson recently said that “we’re constantly monitoring and managing volatility in raw material and component availability and prices – like we have been for the past two years.”
“It’s worth noting that we have very limited direct sourcing from Ukraine and Russia,” the spokesperson said. “However, the situation in Central Europe could exacerbate broader supply chain issues for the industry, including Ford. We have supplies of nickel contracted through the next few years to support our ambitious EV goals.”
Earlier this month, Ford signed a preliminary deal to buy lithium, a key component of car batteries, from a Lake Resources facility in Argentina.
Ford is looking to buy 25,000 tons annually of lithium from Lake’s Kachi project in northern Argentina, which is being developed with privately held extraction startup Lilac Solutions, according to Reuters.