Ford lost $722 million in the first quarter of 2023 in their EV sector.
Will Elon cut prices more to bring the pain to the competition? He could as Tesla is profitable.
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This statement doesn’t make any sense in this context.
He’s sold maybe 100k Mustang Mach-e, and he plans to sell another million plus. Is he saying that it’s more important to not rankle 100k+ customers over pleasing 1M+ customers with lower prices? And even if they are a bit rankled, if they like your product, when they sell the old model, they will likely upgrade to the new model … so if resale went down by $5k and new price when down by $5k, it’s a wash and makes no substantive difference. And if they didn’t like your product, they will be switching away to another manufacturer, so no need to bother with them much.
Almost universally, someone selling a car is replacing it with a another new[er] car, so if prices go down starting from new and down the line to used, it ends up being mostly a wash from the customer point of view. So they do forget because it has little impact.
Most people think the evidence shows that Tesla modifies prices mostly based on their order book, and a little based on varying govt incentives. When the order book wanes, they lower prices a bit. When the order book waxes, they raise prices a bit. That’s almost a perfect representation of the typical supply/demand curve.
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Tesla has explained that their goal is to make as many vehicles as possible (with an eye toward future FSD subscriptions) and to adjust the pricing as needed to make that happen.
These days, both Berlin and Austin gigafactories are ramping up. It’ll be shocking/devastating to non-Chinese legacy companies when Mexico (4 million/year eventual capacity) gigafactory gets rolling. I excepted the Chinese because they… so far… are the only ones demonstrating they can be strongly competitive.
Rob
He is no fool who gives what he cannot keep to gain what he cannot lose.
So, Ford is realizing the early adopters, the people they could gouge the most, have their cars. Now they need to actually compete for the next lower tier of buyers.
Steve
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He’s (Ford CEO Farley) stuck thinking of last decade through present auto cartel/ dealer empire social-climbing yuppie car pricing. And even more of the general aspiration to get on the secret approved list to buy the Ferrari Speciale, and then flip it for a profit for bragging rights and the Youtube video.
Was it 2009 when a Nissan Sentra was offered for $8500? That’s where the economy is headed…
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You can still get a 2009 Nissan Sentra for $8,500 today!
It seems that my recollection of the 2008 or 2009 Sentra MSRP may have been slightly off…IGNORE THAT!
My 90 Ford Festiva was the best cheap car ever. And really, what more does anyone need? Beam axle was nice and bouncy…
