- Fire at Novelis aluminum plant disrupts Ford’s key material supply chain.
- Analysts estimate the blaze could cut the company’s EBIT by up to $1 billion.
- Toyota and Stellantis may also face production challenges from the blaze.
A major disruption could be on the horizon for Ford, with earnings projected to fall by as much as $1 billion after a fire severely damaged a key aluminum plant in New York on September 16.
The incident threatens the flow of aluminum crucial to the F-150’s construction and will also force the automaker to halt production of the all-electric F-150 Lightning next week.
Supply Chain Under Fire
The blaze broke out at the Novelis facility and is expected to keep much of the plant offline until the first quarter of 2026. Analysts at Evercore ISI estimate the financial fallout could trim Ford’s EBIT by between $500 million and $1 billion, with potential knock-on effects for Toyota and Stellantis as well. News of the fire quickly rattled investors, sending Ford’s share price down by six percent.
Read: Ford’s New F-150 Lightning Trim Solves Its Biggest Flaws For Free
“Novelis is one of several aluminum suppliers to Ford. Since the fire nearly three weeks ago, Ford has been working closely with Novelis, and a full team is dedicated to addressing the situation and exploring all possible alternatives to minimize any potential disruptions,” Ford said in a statement issued to Reuters.
The F-150 uses aluminum extensively in its construction to save weight. While it is unclear if Ford will need to make production adjustments to the regular F-150, it has confirmed the fire will force it to pause production of the Lightning next week at the Dearborn, Michigan, plant.
Timing Couldn’t Be Worse
In a memo sent to factory workers, Ford confirmed the Dearborn site will remain idle for the entire week due to the Novelis fire. The pause comes on the heels of a record quarter, with more than 10,000 F-150 Lightnings sold in Q3, helped along by buyers rushing to claim the federal EV tax credit before it expired on September 30
