Ford offers special financing to F-150 buyers with lower credit scores

Ford Targets Broader Market With Special F-150 Financing, Expanding Buyer Pool for Investors

Buying a new truck can feel a lot like shopping for back-to-school supplies—sometimes you need a little extra help to afford what you really want. That’s why Ford’s latest move to make its F-150 pickup trucks more affordable matters for everyday investors and families alike.

What’s Happening?

Ford is now offering special low-interest loans to people with less-than-great credit scores who want to buy an F-150 pickup. Usually, if your credit score is below 620, you pay much higher interest rates. But with this new promotion, even buyers with lower credit can get deals that used to be just for people with top scores.

This isn’t the first time Ford has tried something like this, but it’s a big deal because pickup trucks like the F-150 are super important for Ford’s profits—and for lots of small businesses and workers who depend on them.

Why Should Investors Care?

For investors, this is more than just a car sale. The F-150 is Ford’s best-selling vehicle and a key part of their business. When trucks sell well, it often means the economy is doing well, especially for builders and contractors. But if Ford has to offer big discounts to keep trucks moving, it could mean trouble for profits down the road.

According to Cox Automotive, the average new car loan rate was about 9% in July, and for people with poor credit, it was as high as 18-20%. Ford’s new deals could help more buyers afford a truck, but it also means Ford is taking on more risk if people can’t pay back their loans.

Bull Case: Why This Could Be Good

  • More sales: Lower rates could mean more people buying F-150s, which boosts Ford’s revenue.
  • Clearing inventory: If trucks aren’t selling, this helps clear out old models before the new ones arrive.
  • Supporting workers: Strong truck sales are good for small businesses and the skilled trades, which need reliable vehicles.
  • Market share: Ford stays competitive as rivals like Stellantis (Ram Trucks) and General Motors (Chevy and GMC) also offer deals.
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Bear Case: Why This Could Be Risky

  • Higher risk of defaults: People with low credit scores are more likely to miss payments, especially if the economy weakens.
  • Profit margin squeeze: Offering lower rates cuts into the money Ford makes on each sale.
  • Signals softer demand: If Ford has to offer big deals, it may mean fewer people can afford new trucks at today’s prices.
  • Industry competition: Other automakers are also offering deals, so Ford’s promotions may not stand out for long.

Extra Data: A Bigger Picture

Car prices have soared in recent years, with the average new vehicle now costing about $50,000 (Kelley Blue Book). This makes it harder for many people to buy new cars or trucks, especially with high interest rates. Even with Ford’s promotion, only 3-4% of its auto loans since 2024 have gone to higher-risk buyers, with most customers still having strong credit scores (average of 748).

Historically, when automakers loosen loan standards, it can boost sales in the short term but raise risks if the economy slows. After the 2008 financial crisis, subprime auto lending surged, but many automakers later tightened standards again to avoid losses (Federal Reserve).

Investor Takeaway

  • Watch Ford’s next earnings: See if the promotion boosts truck sales or squeezes profits.
  • Monitor loan quality: If defaults rise, it could hurt Ford’s financial arm and stock price.
  • Compare automakers: Rivals are also offering deals—track who gains the most market share.
  • Consider sector trends: High vehicle prices and interest rates may keep pressuring the whole auto industry.
  • Stay flexible: If you own auto stocks or ETFs, be ready to adjust if signs of credit trouble or weakening demand appear.

For the full original report, see CNBC

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