Ford Slashes Mach-E Prices, Increases Production
Ford is joining Tesla in cutting prices on its most popular EV model, the Mustang Mach-E.
With price cuts ranging from 1.2% up to 8.8% of current MSRP, Ford aims to drum up sales while simultaneously increasing production to 130,000 units annually.
Executives at Ford admit that some of these price cuts will not be profitable on a per-unit basis, though this strategy could help Ford retain or even grow its EV marketplace share.
Dearborn's hit EV, the Ford Mustang Mach-E, is emblematic of the company's transition into the EV market. Despite its initially controversial Mustang nameplate, the crossover has largely been a success for Ford, with sales figures showing 45.4% growth in 2022. That's equal to 39,458 Mach-E units sold in 2022, with Ford selling 61,575 EVs in total (including F-150 Lightnings and E-Transits).
This places Ford in second place for EV sales, leaving a significant margin between itself and the top shareholder—Tesla. Even with such drastic margins between Ford and Tesla, with more than a million unit difference, Ford appears up for a fight. At least that's what its newest EV strategy signals, as the Mustang Mach-E receives a significant price cut for 2023 while the company also increases production.
Ford is offering up to $5900 off its Mach-E lineup, with the GT version going from $71,195 to $65,495, including a model-wide $1500 destination and delivery fee. Not all versions will receive such high price cuts. On the low end of the lineup, Select RWD Standard Range models are priced at just $900 less while Select eAWD Standard Range only receives a $600 sticker price cut. That means the cheapest Mustang Mach-E available, the Select RWD Standard Range, will start at $47,495.
California Route 1 eAWD Extended Range models received the second largest price cut, with a $5580 reduction bringing its MSRP to $59,495. Both of the Premium trim models received price cuts as well, with the RWD model cutting $3980 while the AWD version shed slightly less at $3680 off its MSRP. Ford even made the extended range battery a bit cheaper, now priced at $7000 as opposed to the previous $8600 price tag.
Ford says customers with existing orders for the Mach-E, or those who purchased a Mach-E in January, will be credited for the new pricing. Additionally, Mustang Mach-Es ordered between January 30 and April 3, 2023, may be eligible for special interest rates as low as 5.34% from Ford Credit.
With the price cut intended to drum up sales for Ford, it's easy to see the parallel between Ford's strategy and Tesla's recent price cuts. This strategy has paid off for Tesla in the short term, with sales surging and Tesla stock even receiving Wall Street upgrades as a result. After being undercut by Tesla, specifically with significant price reductions for its Mach-E competing Model Y crossover, Ford's price-slashing response could further a potential EV pricing war.
In fact, Ford's Chief Customer Officer of Electric Vehicle Business, Marin Gjaja, said that these price cuts will not allow certain Mach-E models to be profitable on a per-unit basis, CNBC reports. This signals that Ford is willing to momentarily lose even more money per EV to maintain the Mach-E's place as the third most popular EV model in the US. Despite this, Ford's planned production increase from 78,000 vehicles to 130,000 units annually could make up for this loss of per-unit profitability, as the legacy automaker remains committed to unseating Tesla.
"We are not going to cede ground to anyone. We are producing more EVs to reduce customer wait times, offering competitive pricing and working to create an ownership experience that is second to none," said Marin Gjaja. "Our customers are at the center of everything we do—as we continue to build thrilling and exciting electric vehicles, we will continue to push the boundaries to make EVs more accessible for everybody."
Will Ford unseat Tesla as the EV market leader anytime soon? Share your thoughts in the comments below.