Ford Slashes Price of Electric F-150 Lightning as Demand Weakens

After years of struggling to find enough batteries and other components, automakers are finally starting to mass-produce electric cars and trucks. More than 30 new models will appear in our showrooms this year.

What they need now is more customers.

Electric car sales are growing (up about 48% year-over-year in the second quarter), but not fast enough to keep up with the number of cars coming off the assembly line. And the inventory of unsold vehicles is starting to pile up.

There are more than 90,000 battery-powered cars and trucks on dealer premises, according to market research firm Cox Automotive, four times more than a year ago. That’s enough for him to last 103 days at the current pace of sales, compared to about 50 days for the industry as a whole.

Manufacturers are “having a ‘dream space’ moment,” said Jonathan Gregory, senior manager of economic and industry insights at Cox. “They’ve stockpiled EVs, but now they’re waiting for a buyer.”

Given this imbalance between supply and demand, automakers are cutting prices and offering more incentives. Ford Motor Co. on Monday slashed the price of its F-150 Lightning electric pickup truck from $6,000 to nearly $10,000, with some versions slashing prices by as much as 17%. The company also offers discounted interest rates from his 1.9 percent to his 3.9 percent on certain loans for Lightning purchases.

The move comes on the heels of several price cuts by Tesla, the main distributor of electric cars. In response to Tesla’s price cuts, Ford cut the price of its Mustang Mach-E electric sports utility vehicle, but the Mach-E’s inventory hasn’t returned to a level consistent with sales.

At the end of June, Ford dealers had 16,400 of the model in stock, about 2,000 more than they sold in the first six months of the year.

Many consumers are interested in electric vehicles, but often are not ready to buy them. Many people are hesitant about the high price of electric vehicles and are waiting for them to hit the same price as comparable gasoline models, but recent price cuts could hasten that.

Other car buyers are concerned about how far these cars and trucks can go on a full charge. Many of the models available today need to be charged after 200-250 miles. Not knowing how long it will take to find a charging station or charge a vehicle can be daunting for some.

Glenn Staub, a personal trainer in White Plains, New York, said he wants to buy a hybrid or fully electric vehicle because of the potential environmental benefits and savings on fuel costs. But he won’t hit the market until the 2014 Toyota Corolla is out.

“My car ownership policy is to drive until it’s gone,” he says. It may not be years. His Corolla has just under 100,000 miles on it and is running fine.

Sales of pricier luxury models, a market segment with plenty of choice from Tesla, Mercedes-Benz, BMW, Porsche and Lucid Motors, have been particularly weak. Prices for many of these cars he $75,000 to $160,000.

“I think there was a lot of hype about EVs,” said Rick Rikert, president of Rikert Automotive, which owns nine new car franchises in Dublin. I noticed,” he said. Ohio. “And there was some backlash.”

Rickert said a top-of-the-line F-150 Lightning Platinum truck had been selling for $92,000 for more than two months at his family’s Ford store. “A year ago, it would have sold by now,” he says.

Another electric-vehicle group struggling to find a buyer is one that has been ineligible for the $7,500 federal tax credit under President Biden’s ambitious climate change law, the Control Inflation Act. This credit is only available for vehicles assembled in North America and containing a percentage of battery materials from that region or from US trading partners.

In addition to these limits, electric sedans must sell for $55,000 or less and SUVs, pickup trucks, and vans must sell for $80,000 or less to be eligible for credit.

Buyers of Ford’s Lightning trucks are eligible for a $7,500 credit, and the company plans to sell more pickups in the coming months. The company temporarily halted production this year as it upgraded its assembly line to increase output. By the fall, the company expects to be able to produce 150,000 Lightnings a year at its Rouge Electric Vehicle Center near Detroit, triple his current capacity.

The company’s decision to cut prices may also be linked to increased competition in the electric vehicle business. Tesla announced Saturday that it has begun production of its long-delayed Cybertruck pickup truck, and General Motors will soon start delivering an electric version of its Chevrolet Silverado truck.

Ford will begin production of the Lightning in the spring of 2022, but has raised prices several times by a total of about $20,000 due to soaring battery raw material costs. At the time, demand far outstripped Ford’s production, and some dealers were charging thousands of dollars above the company’s suggested retail price.

“Shortly after the launch of the F-150 Lightning, the cost of EV trucks for Ford and our customers increased due to rapidly rising material costs, supply constraints and other factors,” said the company’s chief customer officer for electric vehicles. Marin Jaja said. in a statement. “We have been working in the background to improve accessibility to lower prices and reduce wait times for our customers.”

The company’s decision to cut prices spooked investors who feared it would hurt Ford’s profits, sending shares down 6% on Monday.

Ford says the F-150 Lightning Pro model currently costs $49,995, down $9,979. His XLT 312A model with a long-range battery was his $8,879 markdown to $69,995. The top-of-the-line Platinum Extended Range model sells for $91,995, $6,079 less than last week’s price.

As a result of the price reduction, most Lightning models cost less than $80,000 and qualify for a $7,500 federal tax credit.