Ford Motor disclosed on Friday that it is targeting the sale of 100,000 vehicles and trucks equipped with its new hands-free driving system within the first year of the feature’s launch.
Ford (F) said that it will make its Active Drive Assist technology more mainstream and plans to first equip the 2021 F-150 truck and the all-electric Mustang Mach-E with the system hardware required for the feature. The software technology, however, will become only available in the third quarter of 2021. The hands-free feature will be included as standard on certain car models or as a relatively affordable option on others, with both vehicle models becoming available to customers in late 2020, the company said.
“As breakthroughs in new technology allow us to help reduce the stress of long highway drives, it’s important to make sure these capabilities can be enjoyed by the largest spread of people possible,” said Ford’s Hau Thai-Tang. “Active Drive Assist can help improve the driving experience while ensuring people remain aware and fully in control, all for a price unmatched by our competitors – a commitment to affordable innovations that has driven us since Henry Ford put the world on wheels.”
The Active Drive Assist technology allows drivers to operate their vehicle hands-free while they are monitored by a driver-facing camera to make sure eyes are kept on the road. The feature is available on prequalified sections of divided highways called hands-free zones across over 100,000 miles of North American roads.
For now, customers can order a Mach-E or an F-150 with the so-called Co-Pilot360 advanced driver assistance package, which includes the Active Drive Assist hardware. Ford added that once the software is launched, the hands-free feature will be activated via a wireless over-the-air update.
F shares, which have seen a steady recovery since hitting a low in March, are still down almost 17% on a year-to-date basis. (See F stock analysis on TipRanks). Last week, the US car maker said it expects to post an adjusted profit for the full-year 2020 driven by robust demand for pickup trucks and SUVs.
The company reported an adjusted 3Q profit of $3.6 billion, or 65 cents a share, beating the 19 cents analysts had expected. Adjusted EBIT margin in the reported quarter was 9.7%, which was nearly 5 points higher than in the prior year and above the 8% target Ford has set itself to attain and sustain over time.
In reaction to the financial results, Morgan Stanley analyst Adam Jonas raised the stock’s price target to $9 (16% upside potential) from $8, and maintained a Buy rating.
Jonas noted that the quarter shows a reversal from years of underperformance, on the back of the company’s “stronger quarter-end financial position driven by strong cash flow generation”.
“Investors are getting excited,” he summed up.
Meanwhile, the rest of the Street has a sidelined outlook on the stock. The Hold analyst consensus shows 8 Holds, 4 Buys and 1 Sell. That’s alongside a $8.72 average analyst price target, indicating upside potential of about 13% from current levels.
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