Ford Reenters $20 Stock Price Range After 20 Years...Will It Become a Rival to Tesla?

Stock Price Surges Nearly 5 Times Since April Last Year
Annual Stock Price Increase Nearly Twice That of Tesla

[Image source=Reuters Yonhap News]

The stock price of Ford, a major U.S. automaker, has surpassed $20 per share for the first time in 20 years. Ford's stock, which plummeted to around $4 last year due to reduced automobile demand amid the COVID-19 pandemic, has recently rebounded nearly fivefold thanks to improved performance in its electric vehicle segment. Since Jim Farley, the CEO who took office in October last year, announced plans to accelerate electric vehicle and battery development, expectations have grown that Ford will establish itself as a strong competitor to Tesla, the leading electric vehicle brand.

On the 8th (local time) at the New York Stock Exchange, Ford's stock price rose 4.49% from the previous close to $20.15. This marks the first time Ford's stock has entered the $20 range since September 2001, 20 years ago. The stock price, which had plunged to $4.24 on April 3 last year during the height of the COVID-19 crisis, has surged nearly fivefold.

According to CNBC, Ford's stock has risen approximately 127% since the beginning of the year. This is a much higher figure than other automakers like General Motors (GM) and nearly double the 68% increase seen by Tesla this year. This upward trend began when CEO Farley took office in October last year.

CEO Farley started focusing on an electric vehicle strategy for Ford, which had been struggling while stuck in its traditional commercial vehicle segment. Since then, Ford's stock has rebounded, supported by improved performance in the electric vehicle sector. Despite semiconductor supply issues, Ford recorded new vehicle sales of 54,000 units in September, a 34% increase compared to August, with electric vehicle sales notably rising 92% year-over-year to 9,150 units.

Additionally, as part of a broad plan to improve its financial structure, Ford announced plans to repurchase up to $5 billion in high-yield bonds and recently succeeded in selling more than $2.5 billion of its newly issued green bonds. CEO Farley stated that the funds raised will be invested in electric battery and electric vehicle development, with investments exceeding $11.4 billion, further raising investor expectations.

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