US legacy car giant Ford has been forced to cut the price of its own Mustang Mach E electric vehicle variant in response to Tesla’s recent dramatic price cuts in US and international markets.
In the U.S., Ford’s Mustang Mach E variant has been slashed by up to $5,900, and four of the six variants are below the $55,000 cap on Joe Biden’s Inflation Reduction Act, giving the U.S. government $7,500. Clean vehicle tax credit.
Today, Mach-E is seen as the biggest challenge to Tesla’s Model 3 and Model Y dominance in electric vehicle sales in the United States.
Ford Model e chief customer officer Marin Gjaja said in a statement: We are working to produce more EVs, offer competitive prices, and create a one-of-a-kind ownership experience to reduce customer wait times. “
“Customers are at the center of everything we do,” Gjaja continued. We will continue to push the boundaries to make it possible.”
Morgan Stanley’s Adam Jonas says in his analysis of the EV price war, Tesla, which will dominate the US EV market with two-thirds of sales in 2022, has effectively forced Ford’s hand. I wrote.
“It’s no surprise that competitors are following Tesla’s 13-20% price cuts across the Model Y and Model 3 ranges a few weeks ago,” he said in a note to customers. Ford is the second largest EV distributor in the US, with market share he has 8%.
Price wars certainly go a long way in accelerating the transition, as high prices are one of the main barriers for those wanting to switch from petrol and diesel vehicles.
The price war will also put pressure on traditional automakers to invest heavily in EV manufacturing to reduce costs and scale production.
Tesla’s big price cutIt shocked many EV market observers.
Tesla’s industry-leading margins allow the company’s best-sellers to stay below the IRA tax credit cap while still being profitable at their prices.
Ford says it is “significantly ramping up production” of its flagship electric Mach E. Less than 40,000 U.S. sales in calendar year 2022 are well below the Model Y’s 255,000 and Model 3’s 199,000.
The Ford Mach-E is not yet available in Australia, but a right-hand drive model is available. Now available in New Zealand and the UK. Ford is expected to start taking orders from Australia later this year.
Daniel Bleakley is a clean technology researcher and advocate with an engineering and business background. He has strong interests in electric vehicles, renewable energy, manufacturing and public policy.