ford Weeks after Tesla lowered prices on its vehicles, the company is boosting production of its popular Mustang Mach-E electric SUV and lowering its sticker price. The move represents a sharp rollback in the price increases Ford announced last summer for the 2023 models — but buyers may still have to pay more than they did before the hike.
The Mustang Mach-E, a mid-size electric family SUV, is the Dearborn, Michigan-based automaker’s first major foray into electric vehicles. Pricing and targeting the Mach-E directly against the Tesla Model Y, which starts at $53,490, is Ford’s bet on getting new car buyers into the battery-powered future. The electric Ford lineup has since been joined by the workhorse Ford F-150 Lightning. But the company still sees the Mach-E as a key step in the company’s electric growth.
Late last year, Darren Palmer, Ford’s vice president of electric vehicle programs, told CNN Business that the Mach-E was completely sold out and the automaker was delaying its introduction in more global markets to catch up with demand in the United States.
“We can at least sell it at least two or three times,” he said at the time.
The steepest price cuts announced by Ford on Monday were on its most expensive SUV models, which are seeing the biggest price cuts. The SUV’s high-performance version, the Mustang Mach-E GT Extended Range, has a base sticker of about $64,000, down $5,900 from its previous $69,900 price tag. But before a price increase last August, that model cost about $62,000.
When announcing these price increases, Ford also said it would pack more standard features into the vehicles, including advanced driver assistance features.
The price of the Mach-E, the cheapest rear-wheel-drive standard-line model, has dropped by $900, from about $46,900 to $46,000. The range-extending battery pack option itself drops from $8,600 to $7,000.
After raising prices in 2022, Tesla earlier this month announced price cuts for its electric vehicles by as much as 20%.
When Ford announced price increases last summer, citing supply chain issues, the automaker said it would continue to monitor market conditions in the upcoming model year.
Ford announced last summer that it was ramping up Mach-E production as it added more battery production capacity. The automaker also announced in late August that it would reopen the Mach-E order pool, which had been closed as the company struggled to fill existing orders.
Customers who complete a Mach-E deal after today’s announcement will pay the new, lower price, Ford said. Ford will directly contact Mach-E customers who already own a vehicle with a sale date after January 1, 2023, the automaker said.
At least some versions of both models are currently eligible for the federal electric vehicle tax credit, according to the IRS, but both are considered cars under tax rules unless equipped with a third row of seats, rather than an SUV.
That means only two-row Mach-Es and two-row Model Ys with sticker prices under $55,000 are eligible for the tax credit. For the Model Y version with the third row of seats, a $4,000 option, buyers can get a tax credit up to $80,000 of list price. For the Mustang Mach-E, the 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 whether the customer itself meets the annual income requirement.