Ford shares have climbed 35% year-to-date, trading at a forward P/E of 9.5 and yielding 4.5%, figures that stand out among large-cap automakers. Yet over the past decade the stock has delivered just a 64% total return versus the broader market, highlighting low long-term growth prospects. Investors should weigh the bargain multiple against compressed gross margins near 7.6% and the company’s significant capital expenditure requirements for its vehicle lineup and manufacturing footprint.

On December 15, Ford announced a $19.5 billion noncash charge tied to restructuring its full-electric vehicle investments, including cancellation of the next-generation F-150 Lightning. The bulk of these special items will hit Q4 2025, with $5.5 billion rolling into 2027. Ford intends to redeploy capital toward higher-return areas such as hybrids, its commercial Ford Pro vans and trucks, and a new battery energy storage business. Management projects Model e EV losses will improve beginning in 2026, with a path to break even by 2029.

Ford led the nation in recalls during 2025, accounting for approximately 35% of all U.S. auto recalls. Warranty expenses reached $2.8 billion in the first half of 2025, up $300 million year-over-year in Q2 despite a $459 million sequential decline in Q3. A December safety recall of 273,000 vehicles over a parking brake defect underscores ongoing quality challenges. These elevated warranty and recall costs are already reflected in the stock’s forward P/E, three times lower than the S&P 500, signaling continued earnings pressure for investors to consider.