According to the Detroit Free Press, Ford is bolstering its EV supply chain to increase production and pass some savings on to consumers. This makes a lot of sense, as bulk component orders typically get cheaper per unit as the quantity grows, allowing Ford to take better advantage of economies of scale. Price cuts should better position the Mustang Mach-E against competitors like the Tesla Model Y. As Ford Model e (that’s Ford’s electric vehicle divison) chief customer officer Marin Gjaja put it in the aforementioned Detroit Free Press piece, “We’ve been planning to adjust for [the Inflation Reduction Act]. And obviously our competitors are also adjusting their prices. … We’re having to respond.”
Discounts go as follows: The base-model Select RWD sees a $900 price cut to $47,295; the Select eAWD sees a $600 price cut to $50,295; the Premium RWD sees a $3,980 price cut to $52,295; the range-optimized California Route 1 sees a $5,580 price cut to $59,295; the GT trim sees a $5,900 price cut to $65,295; and the extended range battery pack sees its price drop $1,600 from $8,600 to $7,000. As ever, all trim level prices include freight charges, in this case coming to $1,300.
Interestingly, Ford is retroactively applying the discounts to qualifying Mach-E customers who bought their cars after Jan. 1, as well as current reservation holders. It’s an uncommon strategy that should avoid some of the backlash Tesla faced after slashing prices. What’s more, Ford says Mustang Mach-E demand currently outstrips supply. The order banks for last year’s model closed in April, and Ford is currently quoting lead times of 18 to 22 weeks for 2023 Mustang Mach-E models. This means that if you order one right now, you probably won’t see it until June or July. In addition, according to the Detroit Free Press, Mach-E production is currently offline as Ford makes factory adjustments to up the production rate. The Cuautitlán plant in Mexico is expected to start back up sometime in the first quarter, with plans to go from producing 78,000 cars per year to 130,000. “We think we can stretch that even further over time,” said Gjaja, a promising outlook for the model’s future.
Cutting prices while demand is high and supply is low sounds unorthodox, but it may be necessary when a key rival has slashed prices considerably. A Tesla Model Y long-range AWD now starts at $54,800 including a $1,390 freight charge, so straddling that line could be a way to keep Ford Mustang Mach-E demand up. In addition, keeping more Mach-E trims priced below the vehicle’s $55,000 car-class cutoff for federal tax credits should keep things competitive as a $7,500 tax credit appeals to a lot of EV buyers. A Mustang Mach-E Select RWD could be as cheap as $39,795 after the tax credit is factored in, assuming the credits apply (If you want more details, I’d recommend checking out this excellent article by Kevin Williams breaking down this confusing aspect of the new tax credit). In addition, increased production rate should speed up delivery times, putting more Mach-Es into more driveways. While not every Mach-E trim level sees a discount, certain models getting cheaper is something we can appreciate, especially given the sky high car prices we’re seeing right now. (Photo credits: Ford) Support our mission of championing car culture by becoming an Official Autopian Member.
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Got a hot tip? Send it to us here. Or check out the stories on our homepage. I had multiple mustangs, including a Cobra. Wouldnt be seen dead in a Mach-E though. They need to bring the prices down a LOT more than that. If Ford is losing money on production, they can make it back later by analyzing the terabytes of data and figuring out which corners can be cut on the second generation. I get what Ford was thinking (though I personally disagree), but I wonder if there’s really a ton of buyers seeking an EV with a “Mustang edge” vs. those who want the mojo of a more affordable Tesla/better looking Bolt? They’re basically crossover shoppers, right, so do they really value the Mustang ethos? Thinking back, naming the new sedan Taurus seems in retrospect to have been a much better idea than calling it the LTD Advance or similar. Conveyed the newness of it, which went with the styling… “Mustang Mach-E is not profitable and it’s not going to be profitable, although by trim series it does vary a little bit,”… He goes on to say they want to be more profitable, but I assume he must be talking about a few select trims. I wonder just how much longer Ford is going to prop up their EVs before the quality goes to pot or they cut unprofitable lines, like they did with sedans and coupes. Get your Mustangs, err, Mach-Es while you can. https://techcrunch.com/2022/06/15/amid-recalls-ford-says-costs-to-build-mustang-mach-e-are-skyrocketing/ I wonder how much they lose on each car. Ford has a bunch of very smart accountants who can probably finesse a lot of numbers to ensure that everything looks as good or bad on paper as helps them in the moment. “Hey, we are going to take a loss on these vehicles to ensure that more customers can drive them” turns into “We’ve ramped up production so that the next gen of EVs will be very profitable, plus we brought potential customers to the brand who may want the latest and greatest” when it’s time to talk to shareholders.
