Ford has followed Tesla’s lead in cutting its electric vehicle prices.
The Dearborn, Michigan-based automaker announced on Monday that it is reducing the price of its Mustang Mach-E Electric Vehicle (EV) by $5,900.
Ford also said it is ramping up its Mach-E production significantly. The company sold 39,458 Mach-E’s in 2022. The Mach-E first edition was its 2021 model, which went on sale in December 2020, according to The Verge.
As previously reported by The Dallas Express, Tesla recently announced it had cut prices on its electric vehicles by as much as 20%. Now, Ford has cut prices by as much as 19% on its extended-range model of the Mach-E. Other models saw price reductions of 8%. The smallest discount was $600 on the Mach-E Select eAWD Standard Range model.
Ford’s decision indicates its commitment to maintaining its market share in the EV space. Ford has a 7.4% market share in EVs as of November 2022, second only to leader Tesla, according to CNBC.
“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 for the 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.”
Tesla’s price reduction saw considerable blowback from customers, but so far, Ford’s decision has not drawn the ire of its buyers.
Customers who are on the waiting list for the Mach-E will automatically receive the new discounted price, the company said.
Dan Ives, an analyst at Wedbush Securities, said Tesla’s decision directly influenced Ford’s.
“Ford just cut Mustang EV prices in response to Tesla’s price cut. Mini price war about to begin with EVs in the US with Tesla’s shot across the bow on price cuts,” Ives tweeted.
Ford CEO Jim Farley spoke on the increased output and price cuts, tweeting, “Scaling will shorten customer wait times. And with higher production, we’re reducing costs, which allows us to share these savings with customers.”
“(Ford’s price cuts) are interesting because they are not even close to winning. The car isn’t as good, it’s more expensive, doesn’t have any technology, why would I buy it,” Ross Gerber, Co-CEO and CIO of Gerber Kawasaki, a Santa Monica-based registered investment advisory firm with $2 billion in assets under management that focuses on clean energy and transportation, told The Dallas Express.
“Elon made it very hard for his competitors by bringing the price down to $55,000 for the Model Y, which is a wonderful deal. I don’t think it will last much longer now that the government has now given model Y the full credit up to $80,000 for the Model Y. He lowered it to $55,000 so he could get the government credit for everybody. Still, now the government today (Friday) said the Model Y qualifies for the SUV 80,000 minimum requirement so I would assume the Model Y prices would go up soon.
“The Mach-E is really one of the few EVs they are making that has been scaling. They have been increasing production, and they don’t want cars to pile up at $65,000 when you can buy a model y for $55,000. It really just puts pressure on Ford to get their prices down, but they don’t have much margin in the car as it is, so it’s really tough on Ford.”
An entry-level Ford Mach-E model was $45,995 for Select RWD Standard Range, while the entry-level Tesla SUV, the compact Model Y, now starts at $54,380, according to Motor Trend.
Meanwhile, competitor General Motors does not appear to be joining in on the EV price war.
“When we look at our strong product portfolio and the interest that we have at the prices that we’ve already announced, we feel that we’re well positioned,” GM CEO Mary Barra said after being asked about competitors’ price cuts.
“We think right now we’re priced where we need to be.”