After getting little attention from Wall Street, GM and Ford
have recently posted some of their biggest stock-market gains in years.
But while its American EV rivals have been selling
all-electric cars for years Ford is just getting started.
Through January it had only delivered 241 of its first
purpose-built EV, the Mustang Mach-E, to U.S. customers. But it also put 5,000
into the pipeline last month, and they’re flying off the lots in an average of
four days, even in the face of stiff competition from the Tesla Model Y.
That’s in part due to one advantage Ford has over it and
GM’s upcoming entry in the segment and should for at least the rest of the
year.
Every electric vehicle in the U.S., including plug-in
hybrids, entitles the buyer to a federal tax credit worth up to $7,500
depending on how big its battery is, but once a company reaches 200,000 units
sold the credit phases out by half and half again before going away completely
over the course of a year.
GM -- which has sold the Volt plug-in hybrid and Bolt EV
over the past decade -- and Tesla each reached that threshold in 2018, so their
cars are no longer eligible for the program. Ford’s are.
CEO Jim Farley revealed during the company’s fourth-quarter
earnings call that, having previously offered plug-in hybrids and that
qualified for lower amounts and a handful of full-electrics, it still has
127,000 full credits to go. That equates to a taxpayer-funded $952,500,000
incentive program before the phase-out period, which doesn’t put a limit on
volume.
This has allowed ford to price the Mustang Mach-E at what it
says is a profitable level while still undercutting the competition. Its
cheapest Select model starts at $35,395 after the credit and the high-end
Premium at $39,500, while the entry-level Model Y costs $41,990. Even the
smaller Chevrolet Bolt EV has lists at $36,500, but Chevy has recently been
offering traditional incentives on it worth $5,000 and more.
Ford isn’t the only company in this position, of course.
Nissan, which was the first to offer a mass-market electric car with the Leaf
in 2010, still has about 50,000 credits left ahead of the launch of its new
Arya later this year and Volkswagen has nearly the full amount as it starts selling
the $32,495 ID.4. Both models set to compete in the same segment as the Mustang
Mach-E.
Ford will be adding the all-electric eTransit commercial van
to the lineup before the end of 2021, however, and an electric version of the
F-150 in the middle of next year, according to Farley, which should squeeze
some of its sales it into the incentive period.
Beyond that, Ford hasn’t said much about what it has planned for electrics, but Farley said he’ll be revealing more details sometime this spring. - FOX