Ford Motor Company (F)

Inventory turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Cost of revenue (ttm)	US$ in thousands	172,547,000	168,834,000	166,355,000	163,681,000	162,102,000	164,289,000	160,567,000	155,699,000	149,527,000	150,169,000	145,813,000	135,306,000	135,547,000	130,908,000	131,706,000	126,046,000	127,658,000	129,027,000	130,719,000	147,748,000
Inventory	US$ in thousands	14,951,000	18,025,000	17,183,000	18,632,000	15,651,000	18,326,000	17,703,000	16,212,000	14,080,000	15,213,000	13,976,000	14,647,000	12,065,000	13,508,000	13,593,000	12,742,000	10,808,000	10,583,000	10,220,000	11,312,000
Inventory turnover		11.54	9.37	9.68	8.78	10.36	8.96	9.07	9.60	10.62	9.87	10.43	9.24	11.23	9.69	9.69	9.89	11.81	12.19	12.79	13.06

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $172,547,000K ÷ $14,951,000K
= 11.54

The inventory turnover ratio for Ford Motor Company has shown fluctuations over the periods indicated. The inventory turnover, which measures how efficiently a company manages its inventory by comparing the cost of goods sold to its average inventory level, has generally been on a declining trend from March 31, 2020, through December 31, 2022. This decline indicates that Ford Motor Company's inventory turnover has decreased over this period, suggesting a lengthening of the time it takes for the company to sell its inventory.

From March 31, 2020, to March 31, 2021, the inventory turnover decreased from 13.06 to 9.89, indicating a reduction in the efficiency of inventory management. The ratio continued to decline through September 30, 2022, reaching a low of 8.96, before showing some improvement by December 31, 2022, at 10.62. This improvement may suggest a more efficient management of inventory during that period.

From March 31, 2023, to December 31, 2024, the inventory turnover ratio fluctuated within a range of approximately 8.78 to 11.54. These fluctuations could be due to various factors such as changes in sales volumes, alterations in production schedules, or shifts in market demand for Ford Motor Company's products.

Overall, a decreasing inventory turnover ratio may indicate excess or obsolete inventory, while an increasing ratio may suggest efficient inventory management. Analyzing the reasons behind these trends in Ford Motor Company's inventory turnover can provide insights into its operational efficiency, production processes, and supply chain management strategies.