• Wed. Jun 19th, 2024

Ford CEO says price cutting in EV market ‘a worrying trend’

Bynewsmagzines

May 3, 2023
Ford CEO says price cutting in EV market 'a worrying trend'

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WASHINGTON — Ford CEO Jim Farley said Wednesday price cutting in the electric vehicle market “is a worrying trend” after the U.S. automaker dropped prices for the Mustang Mach-E in response to a series of reductions by rival Tesla.

Ford on Tuesday announced a price cut of up to 8% of its Mustang Mach-E electric vehicle, the second cut the automaker announced this year.

Farley compared the price war in the EV market to Henry Ford’s series of price cuts for the Model T starting in 1913. But the Ford chief said the company founder’s strategy ultimately put Ford at risk.

“You do not want to commoditize the product,” Farley said at a Wall Street Journal forum. “The resale value for people who bought at higher prices is awful. They never forget.”

Ford will follow Tesla price cuts for models such as the Mustang Mach-E, which competes head-on with Tesla’s Model Y, he said. But, “There’s a limit to how far we’ll go.”

On other points, Farley said Ford does not plan to drop Apple CarPlay software that allows customers to mirror their smartphone screens in a vehicle’s dashboard. General Motors recently said it will phase out CarPlay in future models.

In terms of entertainment streamed into a car, “we kind of lost that battle 10 years ago,” Farley said. Moreover, “70% of Ford customers in the U.S. are Apple customers.”

Ford chose to build a new electric vehicle manufacturing hub near Memphis, Tennessee, in part because the region has cleaner electricity from hydro and nuclear facilities, Farley said.

Ford will train workers for that facility, and will invest in retraining current workers, Farley said. But not all Ford employees will make the transition to electric vehicles, he said.

“We can’t upskill everyone,” he said. “It will take too much time.” 

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