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Ford reducing Mustang Mach-E prices after Tesla announces similar plans

After Tesla announced plans to lower prices of its electric vehicles, Ford has since followed suit with plans to reduce the cost of its Mustang Mach-E.

Morgan Shaver

January 30, 2023 10:45 AM

Ford

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Previously, we reported on Ford increasing the cost of its Mustang Mach-E back in 2022, with customers expected to pay anywhere from $3,000 to $8,475 more on 2023 models than those released the previous year. According to Ford, the reason for increasing the price of its 2023 Mustang Mach-E was due to battery cost increases.

Interestingly, Ford is now walking some of these increases back following Tesla having recently announced plans to reduce the prices of its electric vehicles like the Model Y. Now, Ford aims to lower the price of its Mach-E to be in comparable range to Tesla’s Model Y by an average of about $4,500 depending on the model.

The reductions in price, as reported by outlets like CNBC, amount to approximately $600 to $5,900 across various Mach-E models. The cost reductions aren’t as significant as those being made by Tesla, which is cutting up to $13,000 off the price of its Model Y, but do put the Mach-E closer to what it was originally priced at back in 2022.

“We are responding to changes in the marketplace,” chief customer officer of Ford’s electric vehicle business, Marin Gjaja, remarked as quoted by CNBC. “As we look and want to stay competitive in the marketplace, we’re having to respond.”

Moving forward, the Mach-E’s starting price will range from $46,000 to $64,000 while Tesla’s Model Y will range from $53,500 to $57,000. With these cuts, several Mustang Mach-E models will reportedly be made unprofitable on a per-unit basis. As a way to help foster these price cuts and offset profit shrink though, Gjaja noted that Mach-E production is expected to increase from 78,000 to 130,000 units annually.

Analysts expect Tesla’s price cuts to put pressure on other automakers similar to what’s being seen with Ford and its Mustang Mach-E. The move by Tesla to lower prices has been lauded by both investors and analysts who see it as a “way to drum up demand and increase sales” as reported by CNBC.

For more on the price reduction of Ford’s Mustang Mach-E including a breakdown of updated prices for each model, be sure to read through the full report from CNBC. Also check out some of our previous coverage, including the initial announcement from Ford back in 2022 that Mach-E price would be on the rise due to battery cost increases, and Musk saying that demand for Tesla vehicles in January was the highest they’ve seen in company history.

Morgan Shaver

Senior Editor

Morgan is a writer from the frozen wastelands of Maine who enjoys metal music, kpop, horror, and indie games. They're also a Tetris fanatic who's fiercely competitive in games like Tetris 99... and all games in general. But mostly Tetris. You can follow Morgan on Twitter @Author_MShaver.