Ford cuts Mustang Mach-E prices. Ford appears to be holding steady on its EV F-150. I suppose that is because as there is not yet much competition in EV PU market place at Ford price level except for GM EV PU.
Ford will cut prices across the range of the six Mustang Mach-E variants, with cuts stemming from as little as $600 to as large as $6,000. Most notable are the cuts to the Premium eAWD Standard range model, which takes it to $53,999 from $57,676, thus bringing it under the price cap of the IRA tax credit.
Yes, but when it launched in the US in 2000, no one knew what a hybrid was. When Ford launched the Mach-E you had to have been in solitary confinement for the last decade to not know what a electric car was
Come on, you know there are development and amortization costs with any new product; I’m sure there are large startup costs being charged against the F-150 which makes it “unprofitable.” It likewise hasn’t achieved the kind of scale production that makes a car profitable - and maybe it never will. But that remains to be seen.
Not fer nuthin’ but it took Tesla 17 years to turn a profit. Maybe, just maybe it’s premature to write this kind of click-bait story, or to fall for it.
And Musk was near bankruptcy in 2009-.
I don’t believe it took 17 years to turn a profit. I think in 2013 or 2014 Tesla became profitable. But it wasn’t until 2018 before Tesla really began to produce decent numbers of vehicles.–
You probably have it backwards. The results are no profit now because the volume is low. The initial assembly line costs money. The more produced Ford can go profitable. I am not say they will go profitable on the Mach E but I am saying the only way to profitability is by increasing the volume.
Ok so they have the volume in Ice vehicles correct? They are producing them with a 1.2 percent operating margin correct? That is at volume. Now they produce a ev trying to get to volume on it and Tesla which is already at volume with 17 percent Operating margins and is cutting it’s Gross Margins and keeping it’s Operating margins at those levels, we will have to see what it is next quarter. But they are managing for Operating margins.
With all that, how do you expect Ford to compete with the low cost supplier that still can cut operating margins 16 percent and Ford will most likely have negative operating margins. Increasing volume only works if you can make it to profitability, but if the car is never profitable, well than that is called a money pit.
Affordable electric cars ‘not viable’ https://archive.is/58qEL
A mass market in affordable electric cars will not happen soon because of the difficulty of producing them on a commercially viable basis, one of the largest makers of zero-emission vehicles for British drivers has warned. Paul Philpott, UK chief executive of Kia, the fast-growing South Korean car company, said it had no immediate plans for a mass-market electric product…
Philpott’s prediction also threatens to undermine the government’s ban on selling petrol and diesel vehicles by 2030.
With price inflation roaring ahead in the past couple of years, there are only a handful of electric cars available below £30,000, compared with the less than £20,000 that motorists would expect to pay for mass market or entry-level petrol cars. Even the smallest electric car, the zero-emission version of the Fiat 500, starts at about £30,000.
I agree. But also note that this article is from June of 2022, describing how the then-rising costs of components had erased their profit margins on the Mach-E.
So what did they do? Two months later they raised prices for the Mach-E, jacking them up by $3,000 to $8,000 (depending on the trim).
Which makes sense - it’s pretty much the same pricing path that Tesla took, raising prices in response to rising component and materials cost, and taking advantage of relatively inelastic supply to raise prices without suffering volume cuts.
Which also means that even if Ford was experiencing negative margin on those vehicles in June, we don’t know whether that continued once they raised prices.
Now that component costs are falling again, Tesla was able to slash prices - as was Ford in response. Up to $6,000 (which is a lower price cut than the price increase back in June, so prices are still higher). So we still don’t know whether Ford has negative margin on the Mach-E any more, or whether that was a transitory condition caused by high component costs in summer 2022.
I don’t think “probably” is the right word, there. Tesla does many things amazingly well. Two of the things it doesn’t do well are:
1 - Bring new models from design to full production quickly or on their anticipated schedule; and
2 - Accurately forecast the entry-level price for new models.
So “probably” isn’t the right word - based on Tesla’s past practice, it’s pretty unlikely that anyone will be able to actually buy a “Model 2” (or whatever it ends up being called) until 2025 at the earliest. By which time you might see BYD - the world’s leading EV maker - starting to develop an actual export business of their affordable mass-market cars.
Not really true. While the Mustang Mach-e has nothing at all the same as a “real” Mustang (and Mustang purists have been bitterly castigating Ford over using the name), the F-150 lightning is remarkably similar to the F-150 ICE. But better. Much better.
The bigger unseen issue going from year to year is the setup of assembly lines. The cost is high, it is very capital intensive. Begrudging Ford for having a lower volume of production and sales at the beginning is like ignoring Tesla’s early numbers. Or ignoring a new assembly line’s costs at Ford for an ICE.