In the United States, a price war seems to be looming among manufacturers of electric cars. Car manufacturer Ford will lower the price of its electric Mustang Mach-E by an average of $ 4,500 (about 4,140 euros). The company thus responds to a price reduction previously announced by Tesla. Other Ford models are also becoming cheaper in the US.
It is not yet known whether Ford will also reduce its prices in Europe. Tesla did that worldwide, including in the Netherlands. Elon Musk, the company’s chief executive, acknowledged last year that prices had become “embarrassingly high” and could hurt demand. According to him, demand has increased sharply in recent weeks by reducing prices.
People who bought a Tesla before the reduction are not exactly happy about this. They see the value of their car on the second-hand market fall faster.
Price drops
And now the American car manufacturer Ford is following suit. The cheapest Ford Mustang Mach-E will now be on sale from $45,995 (42,221 euros), down from $900 (826 euros). The biggest price drop occurs with the GT Extended Range, which is $ 5,900 (5,418 euros) cheaper and can now be purchased from $ 63,995 (58,776 euros). Optional batteries with a higher range will also become cheaper, about 19 percent.
The price war in the electric vehicle market is intensifying with the move. Tesla had already decided earlier this month to implement price reductions of up to 20 percent.
“Comment”
“Our competitors are also adjusting their prices. If we want to remain competitive, we have to respond,” said Marin Gjaja, a director of Ford’s electric business in the US. The price reductions in the US mean that the electric Ford, like a number of Tesla models, is eligible for the US$ 7,500 tax credit for electric vehicles in the country.
Scaling up
Ford already indicated before the price reduction that its electrically powered Mustang is unprofitable. Chief Financial Officer John Lawler had reported in June that profits on the Mach-E had been “wiped out” by rising commodity prices.
Gjaja emphasizes that Ford is working on improving margins on the Mach-E, but he cannot say whether the model has become profitable. Among other things, scale is being targeted to reduce costs: production of the Mach-E will be increased by 67 percent this year, from 78,000 to 130,000 cars.
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