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Ford (F) Postpones Bronco Launch on Supply-Chain Disruptions

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Ford Motor Company (F - Free Report) recently announced its decision to delay the customer delivery of the all-new 2021 Bronco sport utility vehicle (SUV).

The Bronco two-door and four-door SUV, originally slated for a spring 2021 debut, will now be rolled out by the end of next summer. The pandemic-induced hurdles faced by Ford’s suppliers pushed back the launch of the SUV. The automaker did not reveal the suppliers that are facing these challenges.

Moreover, orders for the new SUV will now begin in mid-January 2021 instead of Dec 7, 2020. This is when reservation holders will be able to actually convert their reservations into proper vehicle orders and have the option to configure a two-door or four-door Bronco on Ford's website configurator. Reservation holders have until Mar 19 to choose their preferred build and specifications and select the dealer, agree to the selling price, and place their final order. Previously, the deadline for the same was Jan 31. The 2021 Bronco has a base price of $29,995 for the two-door model and $34,695 for the four-door model.

Additionally, Broncos equipped with the Sasquatch package having manual transmission will now move to being a 2022 model year rather than 2021. It was initially planned for late 2021, but now the launch date has been pushed back. There is no confirmation regarding the delivery time of the manual transmission model currently.

The off-road-specializing Sasquatch package consists of 17-inch beadlock-capable wheels, 35-inch tires, full-time four-wheel drive, front and rear locking axles, a high-clearance suspension and fender flares, and a performance-tuned suspension with Bilstein dampers and control valves for a smoother off-road ride.

The compact crossover Bronco Sport has not been affected by the delay, which is arriving at dealerships as scheduled.

Supply-Chain Hurdles Impair Auto Industry

The pandemic has rattled the auto industry, resulting in factory closures and supply-chain distortions. However, with consumers uncertain of using mass transit and ride-sharing options, auto demand has stayed surprisingly steady since the pandemic hit.

Nevertheless, production delays and supply-chain disruptions have hampered assembly and delivery of new vehicles by automakers, causing inventory shortages at dealerships. As inventories are draining out, automakers and their global supply chains have been unable to cater to the rising vehicle demand, underlining weakness in an industry that will take a long time to return to normal.
 
Nonetheless, Ford had been on top of its game with its upcoming models like Mustang Mach-E and Bronco. Yet, the delay in the highly-anticipated Bronco SUV by one entire season has come in as a major blow for the Dearborn-based automaker.  Apart from this, the company will have to bear huge costs for shutting down its assembly line over supply-chain bottlenecks.

Ford is not the only automaker feeling the heat of the coronavirus mayhem. Other automakers have faced similar issues in the past months thanks to the auto industry’s high dependence on external parts suppliers, many of whom are battling financial hurdles amid the pandemic.

Recently, General Motors (GM - Free Report) halted its Corvette production due to a pandemic-led supplier obstacle. Toyota Motor Corporation (TM - Free Report) has also encountered similar problems with its truck plants in the past.
 
Ford, peers of which include Fiat Chrysler Automobiles and General Motors, currently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Notably, shares of Ford have appreciated 0.4% year to date while the industry has witnessed a rise of 222.8%.

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