Ford Motor Co. faces significant challenges with its current 8% dividend yield, primarily due to a steep decline in its stock price and weak global sales. The company's substantial investment in electric vehicles, projected to exceed $5 billion this year, contradicts the fact that EVs accounted for only 4% of U.S. sales in the first quarter. This presents concerns regarding the sustainability of the dividend, with observers noting that a potential cut could increase stock volatility. The gap between Ford’s traditional gas-driven sales and its electric vehicle ambitions might undermine investor trust.
"Ford's current 8% dividend yield raises concerns about sustainability due to weak global sales and heavy investment in electric vehicles that are not yet yielding significant returns."
"With EVs comprising only 4% of its U.S. sales in Q1, Ford faces challenges in generating capital returns from its $5 billion investment in this segment."
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