BMW, Hyundai, GM, and Mercedes won’t yet join Tesla’s EV price war

Tesla’s recent move to cut the price of the Model 3 and Model Y by thousands of dollars has been called the beginning of the electric car price war. But not all car companies are vying to participate.

As automakers push to electrify their vehicles and catch up with Tesla’s lead in the market, they may have to compete for buyers at steep discounts. Ford also announced on Monday that it will cut the price of its electric Mustang Mach E by an average of $4,500.

In a few days, Ford may prove to be an outlier here. The Barge reached out to several automakers with current EV-focused lineups and upcoming electronics to ask if they’re considering discounts. So far, two of Germany’s largest luxury automakers and one of South Korea’s burgeoning leaders in the sector have said they are sticking with prices.

Officials from BMW, Mercedes-Benz and Hyundai all said they have no plans to cut prices at this time.

“We have no plans to modify our current pricing strategy to reflect the premium and inclusive customer experience expected from Mercedes-Benz,” spokesman Robert Moran said in an email.

Hyundai spokesperson Miles Johnson expressed a similar opinion.”Hyundai has not taken concrete steps in response to competitor price changes, but we constantly assess the market as a whole to ensure that vehicles We make sure the price is competitive,” he said. Our current EVs, including Kona, Ioniq 5 and the recently announced Ioniq 6, offer consumers advanced technology and features at attractive prices. ”

Furthermore, a spokesperson for the Bavarian automaker said: “From the BMW brand’s point of view, we have no plans to reduce the price of our electric vehicles.”

Officials at General Motors, Polestar and Kia Motors, which all have several new EVs in their pipelines, did not immediately respond to requests for comment.

GM CEO Mary Barra said on Tuesday’s fourth-quarter earnings call that she is reluctant to change EV pricing at this time.

“Given our strong product portfolio and the interest in the pricing we have already announced, we feel we are well positioned.” the rose said.[Going into] In the first month of the year we witnessed very high customer interest in our product…we now consider it the price we need. ”

Wall Street analysts unsure if GM can hold firm on price with Wells Fargo release the note It says it expects automakers to “yield to pricing” as a result of competitive pressure.

Earlier this week, Volkswagen Group CEO Oliver Blume said: Frankfurter Allgemeine Sonntagzeitung newspaper His brands, including Audi, Porsche and others, had no plans to cut prices.

“We have a clear pricing strategy and focus on reliability. He added that the focus is on “profitable growth” with EVs.

That’s probably where Tesla can hit its traditional competitors the most. Tesla just released profitable results for the fourth quarter and full year, but says demand is weakening in the U.S. and China as its lineup ages and more competitors enter the space. I have questions.this is Higher profit margin than many traditional automakers.

Simply put, Tesla can afford to make this move, as it is desperate to put EVs on the road, even if other car companies aren’t yet profitable. Other automakers can lower the price of EVs, but given the high cost of production, it means a loss in the end. Malin Ghaja, chief customer officer of Ford’s electric vehicle business, said: Yesterday it admitted that not all models of the Mustang Mach-E are profitable. At certain trim levels after these discounts.

“Tesla is uniquely positioned in this EV arms race around its size, brand, battery technology and Mask DNA, while other companies are aggressively targeting market share in this all-out war. game of thrones Wedbush Securities analyst Dan Ives said he is a Tesla bull but also an occasional Elon Musk critic.

“In our opinion, there is a window of opportunity to capture share in the burgeoning EV market, and 2023 will be a pivotal year in establishing winners and losers in this EV landscape, with Tesla poised to climb the mountain. is at the top of the

Ives said GM has an advantage here, having built the Ultium EV platform that underpins a slew of new EVs, from luxury Cadillacs to affordable pickup trucks. But for traditional automakers, the battle ahead means balancing profits and achieving EV sales volumes, he said.

Additionally, the revised EV tax incentives under the Biden administration’s Inflation Reduction Act have thrown the market into turmoil. EVs are not made in North America, so not all automakers qualify for the tax credit. For example, it’s a big loss for Hyundai and Kia, which don’t produce EVs in North America. Moreover, in the long term, it is unclear how EVs with batteries not sourced in America will perform under the new regulations.

If you’re looking to buy an EV this year, you may be the real winner as more cars enter the market and the price war continues — as automakers keep their If only we could overcome the supply problems that plagued the