Ford Shares Tumble After Company Slashes EV Prices To Match Tesla Price Cuts
Five days after we reported that Tesla was accused of ‘weaponizing’ price cuts in order to crush their competition in the electric vehicle space, Ford announced priced cuts for their electric Mustang Mach-E along with several other models ‘across the board.’
The company will also increase production, “underscoring the company’s commitment to lead the EV revolution by increasing the value of its EVs for customers,” according to a Monday press release.
“We are not going to cede ground to anyone. We are producing more EVs to reduce customer wait times, offering competitive pricing and working to create an ownership experience that is second to none,” said Marin Gjaja, Chief Customer Officer, Ford Model e. “Our customers are at the center of everything we do – as we continue to build thrilling and exciting electric vehicles, we will continue to push the boundaries to make EVs more accessible for everybody.”
Customers who are awaiting delivery of their Mach-E’s will automatically receive the adjusted price, while Ford will ‘reach out’ to anyone who bought one after Jan 1, 2023.
Shares of the Michigan-based automaker dropped as much as 3% in pre-market trading.
Tesla’s move to squeeze competitors by sacrificing some of its strong operating-profit margins could be seen in a recent price cuts on the Model Y – which is now priced at $53,000, down from around $66,000. If buyers qualify for the federal tax credit, the can knock off another $7,500.
Bank of America analyst John Murphy said, unlike Tesla, traditional automakers have very thin profit margins or lose money on their EV lineups. He said such a move to reduce prices could spark a price war.
“These price cuts are likely to make the business even more difficult, just as they are attempting to ramp production of EV offerings,” Murphy said.
If other automakers and dealers match Tesla price cuts, core CPI could drop by more than 1% M/M
— zerohedge (@zerohedge) January 13, 2023
Ford just did lol
— 0x.eth (@0xbirdapp) January 30, 2023
Mon, 01/30/2023 – 08:49