Ford, Tesla and other automakers are having to lower prices to lure buyers as the supply of battery-powered models begins to exceed demand.
Automakers are already producing numerous electric cars and trucks after battling for a few years to acquire enough batteries and other components. This year, more than 30 new models will hit the market. They currently require additional clients.
Sales of electric vehicles are climbing, up nearly 48 percent from a year earlier in the second quarter, but not quickly enough to keep up with the number of vehicles coming off the assembly lines. Vehicle stockpiles are also beginning to build up.
According to Cox Automotive, a market research company, there are more than 90,000 battery-powered vehicles and trucks on dealer lots, which is four times as many as there were a year earlier.
At the present rate of sales, that would last 103 days as opposed to 50 days for the industry as a whole.
According to Jonathan Gregory, senior manager of economic and industrial research at Cox, “manufacturers are experiencing a ‘Field of Dreams’ moment. They constructed an E.V. inventory, but they are currently waiting for purchasers.
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Imbalanced Supply And Demand Impacting Automakers’ Pricing Strategies
The imbalanced supply and demand is forcing automakers to lower prices and increase incentives.
Ford Motor dropped the cost of its electric F-150 Lightning pickup truck from $6,000 to almost $10,000, or as much as 17% on some models, on Monday.
Additionally, the corporation is providing Lightning loan customers with lower interest rates ranging from 1.9 percent to 3.9 percent.
These actions come after numerous rounds of price reductions by Tesla, the leading provider of electric vehicles.
Although this hasn’t brought Mach-E inventory back in line with sales, Tesla’s price cuts early this year spurred Ford to decrease prices of its Mustang Mach-E electric sport utility vehicle.
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Source: nytimes.com