There has been a broader market selloff amid the escalating tensions in the Middle East. The meltdown has created some good buying opportunities, but not every stock that has come off its 2025 highs is a buy. One legacy automaker, Ford (F), still does not look like a compelling buy despite having fallen over 15% from its recent highs.
While some of the fall in Ford shares is due to the weakness in wider markets, company-specific factors are also adding to the doom. Last week, the company recalled 4.3 million vehicles over software issues, which was preceded by a recall of 4.13 million vehicles due to an issue with rear suspension toe links. Now, the National Highway Traffic Safety Administration (NHTSA) has said that the Blue Oval will recall over 600,000 vehicles due to an issue with the windshield wiper motor. While recalls are not uncommon in the automotive industry, in Ford’s case, the frequency has been unusually high.
Last year, the company had 153 recalls, which is the highest for any automaker in modern history. In terms of numbers, it recalled 12.9 million vehicles last year, and 2026 looks like it’ll be another dismal year for Ford in terms of recalls. While Ford’s management has long been saying that recalls and higher warranty costs are a “legacy” issue it is trying to address, it has also recalled many of the newer models, so they can’t be brushed aside as legacy issues.
To make things worse, February sales data showed that Ford’s U.S. sales fell 5.5% compared to the corresponding month last year. Its internal combustion engine (ICE) car sales fell 0.1%, but the 71% fall in electric vehicle (EV) sales and 21.8% decline in hybrid sales pulled down the company’s consolidated numbers.
Notably, legacy automakers’ EV businesses are struggling, which has prompted them to book massive losses on their multi-billion-dollar bets. In December, Ford announced a $19.5 billion write-down, of which $5.5 billion would be in cash. Detroit rivals General Motors (GM) and Stellantis (STLA) have also announced massive charges from their respective EV businesses amid stalled sales following the withdrawal of the EV tax credit.
