Ford is increasing production of its popular Mustang Mach-E electric SUV and lowering its target price weeks after Tesla cut prices for its vehicles. The move represents a substantial step back from price increases Ford announced last summer on 2023 models – but buyers may still be paying a bit more than before the increases.
The Mustang Mach-E, a mid-size electric family SUV, was the Dearborn, Michigan-based automaker’s first serious electric effort. Priced and aimed directly at the Tesla Model Y, which has its own starting price of $53,490, the Mach-E is Ford’s bet to entice new car buyers to dip their toes into the battery-powered future. it has since been joined in Ford’s electric lineup by the workhorse Ford F-150 Lightning. But the company still sees the Mach-E as a crucial step in the company’s electric growth.
Late last year, Darren Palmer, vice president of electric vehicle programs at Ford, told CNN Business that the Mach-E was completely sold out and the automaker was waiting to launch it in more global markets. to catch up with US demand.
“We could sell it at least two or three times over,” he said at the time.
The price cuts announced by Ford on Monday were the largest on the most expensive versions of the SUV, just as the increases had been the largest on those models. The base sticker for the Mustang Mach-E GT Extended Range, a high-performance version of the SUV, is down to around $64,000 from $69,900 previously, a drop of $5,900. But that model was priced around $62,000 before price increases last August.
When it announced the price increases, Ford also said it was putting more standard features in the vehicles, including advanced driver assistance features.
The price of the least expensive Mach-E, the rear-wheel-drive standard line model, has been reduced by $900, from around $46,900 to $46,000. The price of the long-lasting battery option, alone, has gone up from $8,600 to $7,000.
Tesla announced price cuts of up to 20% on its electric vehicles earlier this month, after raising prices in 2022.
When Ford announced the price increases last summer, citing supply chain issues, automakers indicated they would continue to monitor market conditions throughout the upcoming model year.
Ford announced last summer that it was increasing production of the Mach-E by expanding battery production capacity. The automaker also announced in late August that it was reopening order banks for the Mach-E that had been closed as the company struggled to fill existing orders.
Customers who complete the transaction for their Mach-E after today’s announcement will pay the new lower price, Ford said. Ford will contact Mach-E customers directly with a sale date after January 1, 2023 who already have their vehicles, said the automaker.
At least some versions of both models are currently eligible for federal electric vehicle tax credits, according to the Internal Revenue Service, but both are treated as cars, not SUVs, under tax rules. unless they are equipped with a third row of seats.
That means tax credits are available for the two-row Mach-E only and the two-row Model Y only if the list price is under $55,000. For Model Y trims with a third row of seats, a $4,000 option, buyers can get tax credits with a list price of up to $80,000. For the Mustang Mach-E, a third row of seats is not offered.
The final amount of the tax credit may depend on when the vehicle is actually delivered to the customer and, also, whether the customers themselves meet the annual income requirements.