Ford Inc., the renowned American car manufacturer, experienced a massive blow in the stock market, losing a staggering $3.6 billion in value in just a single day. This substantial loss was triggered by investors' unfavorable response to recent price cuts applied to their all-electric F-150 Lightning truck.
As a result, Ford's shares plummeted by 5.9 percent, marking the company's most significant drop in the past five months, according to a report by Automotive News. The price reductions, which amounted to nearly $10,000 for the entry-level trim of the F-150 Lightning, were implemented in response to the global chip shortage and the soaring costs of battery materials like lithium and nickel.
These increases had previously forced the automaker to raise prices, making the vehicle less affordable for potential customers. Now, with an improved availability of computer chips and a decline in raw material costs, the Michigan-based company took the strategic step of slashing the prices of its electric pickup.
This move comes just ahead of the highly anticipated commercial launch of the Tesla Cybertruck, scheduled for the third quarter, potentially in September.
Tesla's Stock Soars Amid Ford's Price Cuts
Ironically, while Ford's price cuts had an adverse impact on their own market position, it seemed to work wonders for Tesla, whose stock price doubled during the year.
Record-breaking deliveries in the previous financial quarters drove Tesla's remarkable success. This latest action by Ford appears to be in contradiction to earlier statements made by their CEO, Jim Farley. He had previously emphasized the company's focus on EV segments with "serious pricing power" and stated that they would avoid areas becoming overly "commoditized." Although the price cuts may bring relief to prospective Ford customers, it's essential to note that the cheapest version of the F-150 Lightning, the Pro model, still remains approximately $10,000 more expensive than when it was initially launched in January 2022.
However, the most expensive trim, the Platinum, is now closer to its starting price from a year and a half ago, currently priced at $91,995 compared to $90,874 in early 2022. At present, the Michigan factory responsible for manufacturing the electric F-150 is undergoing upgrades, resulting in its temporary closure.
Once reopened next month, the factory aims to produce an impressive 150,000 Lightnings per year, three times its previous output. In terms of sales, Ford's battery-powered pickups have seen modest numbers, with 1,424 units sold in the United States last month, and a total of 4,466 units sold in the second quarter of the year.