Ford Motor cut the price of its electric crossover SUV Mustang Mach-E by up to $5,900 per vehicle, just weeks after rival Tesla Inc slashed prices on its electric vehicles globally by up to 20%.
Ford shares fell 2.9 percent to $12.89 in above-average trading. Tesla dropped 6.3 percent. The move comes as electric vehicle manufacturers are under pressure to respond to Tesla’s price cut.
“Ford just cut Mustang EV prices in response to Tesla’s price cut. A mini price war is about, to begin with, EVs in the US with Tesla’s shot across the bow on price cuts,” said Dan Ives, an analyst at Wedbush Securities, on Twitter.
The move restores eligibility for at least one additional version of the Mach-E for a $7,500 federal tax credit, which previously required the Ford EV to have a suggested retail price of no more than $55,000 to be eligible.
Ford had already planned to increase Mach-E production at its Mexico plant to 130,000 vehicles this year, up from 78,000 in 2022, and announced in November that it was accelerating Mustang Mach-E production and aiming for a global annual production rate of 270,000 by the end of 2023, including China production.
Ford sold 39,458 Mach-Es in the United States last year, up from 27,140 in 2021. General Motors said it had no plans to adjust prices in response to others. The Detroit automaker in June cut prices on the Bolt by around $6,000 and by as much as 18 percent for the lowest-price version and earlier this month the vehicle became eligible for the $7,500 federal tax credit.
