2023 Ford Mustang Mach-E Prices Slashed Amid High Inventory

[Roland]

On 2/23/2024 at 5:23 PM, mackinaw said:

The pressure came from the investment community.  Five years ago, influential Wall Street analysts, like Adam Jonas (Morgan Stanley), predicted the EV wave would be like a tsunami.  He was predicting mass adoption of EV's in a matter of a few years.  If your company wasn't seen as investing in EV's, then it had no future.  So, fearful that they would lose investors, every manufacturer fell in line and developed EV's.  Fast forward to 2024, and the mass adoption of EV's is moving at a much slower rate than anyone expected (outside of Akio Toyoda).  As is always the case, the marketplace has the final word.    

 

Nobody who understands the technology or the market believed that timeline.  Any objective analyst understood that transition was going to take at least a decade and probably more. Jonas is a cheerleader for the change because it creates a lot of new growth opportunities.  He really doesn't care whether it burns down the legacy automakers.  He can make a lot more money pumping new makers and new suppliers than he can make collecting Ford dividends. 

 

People who make predictions like this aren't making rational assessments of the market.  They're talking about what they want to happen.  In a similar vein, a think tank called RethinkX was pushing the idea that personal vehicle ownership would end almost entirely by the end of the decade, replaced by on demand rental of autonomous vehicles.  Farley bought into all of that. 

 

Farley gutted the product line to dump billions into these technologies and he has nothing to show for it.   There is no question that some of these changes are coming, but Ford has thrown away billions in a panic.  They've gotten away with it so far because pandemic impacts propped up extortionary pricing.  But that's ending and the chickens are coming home to roost.  You can't up-market your way into long-term profitability.  The market won't support it.  Consumers are over-burdened with debt and a correction is inevitable.

 

 

[silvrsvt]

5 hours ago, Roland said:

Farley gutted the product line to dump billions into these technologies and he has nothing to show for it.   There is no question that some of these changes are coming, but Ford has thrown away billions in a panic.  They've gotten away with it so far because pandemic impacts propped up extortionary pricing.  But that's ending and the chickens are coming home to roost.  You can't up-market your way into long-term profitability.  The market won't support it.  Consumers are over-burdened with debt and a correction is inevitable.

 

Gutted the product line? Got rid of an product that had no real viable way of going forward? Sedans/hatchbacks where dead by 2020. 

[jpd80]

2 hours ago, silvrsvt said:

 

Gutted the product line? Got rid of a product that had no real viable way of going forward? Sedans/hatchbacks were dead by 2020. 

Not directly attacking your point as there’s a lot of truth in that but,

Farley redirected $11 billion in ICE programs to help fund Electric Vehicle development,

that amount of funding is way more than just cancelling a few sedans and hatchbacks.

 

I tend to think that he cut too deep on programs like hybrid/PHEV development and

more comprehensive refreshes to products that are now needed to “carry the load”.

Prhaps the current pause probably give Farley reason to revisit and dust off some

of those better possibilities  and strategies that were ash canned a few years ago..

Edited February 26 by jpd80

[Chrisgb]

On 2/21/2024 at 9:14 AM, fuzzymoomoo said:

On a completely unrelated note, it drives me nuts how ford authority ends every damn article with the same fill-in-the-blank form paragraph. 

"We'll have more from @fuzzymoomoo soon so be sure to suscribe (sic) to BOF!"

[fuzzymoomoo]

13 minutes ago, Chrisgb said:

"We'll have more from @fuzzymoomoo soon so be sure to suscribe (sic) to BOF!"

Oh go play in traffic! 

[Deanh]

On 2/23/2024 at 1:23 PM, silvrsvt said:

But that apparent loss is because things like the battery plants and BOC are figured into that said profit margin that Model E is losing their shirts on. Let’s see what the actual deal is when they come online. 
 

it’s like the 30-60k battery pack replacement costs that get thrown around-there is next to no “extras” being built so the price goes up accordingly. Economics 101. It’s like Bronco Raptor parts-I’ve seen the dash handles getting sold for $1200 bucks then the regular ones cost maybe 1/8th of that. 

if and when they come on line..if ,as they have, been sitting back observinbg progress and otrher manufacturers, I for one would be EXTREMELY hesitant...batteries will most likely make a huge difference...but righgt now????...hold my beer...

[Chrisgb]

These are some significant discounts being offered, but the challenges of owning a BEV are still there. I think the BEV consumer is becoming better educated about the day to day challenges of operating a BEV, the uncertainty of when convenient and efficient charging will come, and the environmental and infrastructure impacts of building and operating BEVs. Hydrogen fuel cell technology has it's own drawbacks, especially for light vehicles, but I think that kettle should be kept on the warming plate.

[silvrsvt]

1 hour ago, Chrisgb said:

These are some significant discounts being offered, but the challenges of owning a BEV are still there. I think the BEV consumer is becoming better educated about the day to day challenges of operating a BEV, the uncertainty of when convenient and efficient charging will come, and the environmental and infrastructure impacts of building and operating BEVs. Hydrogen fuel cell technology has it's own drawbacks, especially for light vehicles, but I think that kettle should be kept on the warming plate.

 

https://www.autoblog.com/2023/11/08/toyota-mirai-hydrogen-refueling/

 

Some of the problems:

Oh, and one more advantage: cost. Owners of both the Mirai and Hyundai Nexo get $15,000 worth of hydrogen over the course of a three-year lease or six-year ownership period. At the current hydrogen price I spotted at True Zero station ($36 per kilogram), you’d theoretically be getting 83 tanks of fuel included.  

 

OK, so how far does a “tank” get you? The Mirai Limited trim I drove is good for 357 miles of range with full tanks (the XLE can do 402). So, using basic math, you could theoretically get about 30,000 miles worth of free fuel before it gets $LOL to refill. Certainly, the lease option is the better deal.

 

Of course, none of this refueling debacle touches on the issues surrounding where that hydrogen comes from in the first place. As most of the gaseous hydrogen in our solar system is located in the sun and Jupiter, we have to split it away from another chemical compound. The overwhelming majority comes from compressed natural gas, aka methane, which is a fossil fuel. D’oh! This would be what is known as “gray” or “blue” hydrogen, and definitely not emission-free. What you really want is “green” hydrogen, which uses water, but even then you’re using a huge amount of power to split water molecules to make hydrogen so you can then fuse it back together with oxygen to create power and water. That makes sense?

 

I saw another article state that Hydrogen was at $82 per kilogram...as that article states, trying to find a place to fill up at is worse than finding an EV charge point. 

 

[jpd80]

On 2/24/2024 at 7:23 AM, silvrsvt said:

But that apparent loss is because things like the battery plants and BOC are figured into that said profit margin that Model E is losing their shirts on. Let’s see what the actual deal is when they come online. 

But there’s the thing, the reason that Ford is/was going gangbusters with developing BOC and the associated battery plants is exactly because it badly misjudged the projected ramp up after getting excited over those 200k reservation that  eventually evaporated into thin air..

 

Farley made a concerted decision to set up Model E s a separate business unit not only to insulate

 it from Ford bureaucracy but also to track all costs and infrastructure asset development.
If you think about that $4 billion loss (financed), is it more a paper loss to claim tax deductions?

We all know that it will be decades before Ford’s BEVs are able to self fund and pay for all that

infrastructure, the financial heavy lifting must be carried by the other two profitable divisions

making ICE retail, commercial and fleet vehicles.

 

When you’re a CEO, “let’s just wait and see” does not play well in front of the board but I don’t 

see Farley having any other choice but to slow the pace of BEV manufacturing plants and battery

plant  capacity - maybe limit to an expandable stage 1 while Ford revisits profitable vehicles in the now.

 

Quote

it’s like the 30-60k battery pack replacement costs that get thrown around-there is next to no “extras” being built so the price goes up accordingly. Economics 101. It’s like Bronco Raptor parts-I’ve seen the dash handles getting sold for $1200 bucks then the regular ones cost maybe 1/8th of that. 

It’s easy to be dismissive of the two Hyundai battery cases but it highlights an underlying strategy,

a level of added cost that has not been factored into insurance of electric vehicles and how the wider

community of insured vehicles will see their premiums go up to cover this nonsense.

 

Suppliers have worked out that it’s not in their best interest to have too many of these parts

lying around. As with other parts,  more profit can be had by squeezing vehicle owners nuts

a bit harder…..

Edited February 26 by jpd80

[Roland]

On 2/25/2024 at 9:15 PM, silvrsvt said:

 

Gutted the product line? Got rid of an product that had no real viable way of going forward? Sedans/hatchbacks where dead by 2020. 

 

Yes, gutted the product line.  Ford has one affordable product in it's entire lineup. Practically everyone has more affordable models than Ford.  If you're not a luxury brand then you're not going to be around if you can't make affordable vehicles. 

 

 

[akirby]

5 hours ago, Roland said:

 

Yes, gutted the product line.  Ford has one affordable product in it's entire lineup. Practically everyone has more affordable models than Ford.  If you're not a luxury brand then you're not going to be around if you can't make affordable vehicles. 

 

 

So what are Bronco/Ranger sales and profit compared to Focus?  Maverick/Bronco Sport compared to Fusion?  They cancelled fiesta and Ecosport with replacements but if you look at Ford sales and profit today volumes and market share are almost the same adjusting for supply chain issues and profit is as good or better even though they’re dumping a lot of cash into EVs.  This notion that they need cheap sedans with no profit to survive is absurd.

[fuzzymoomoo]

4 hours ago, akirby said:

So what are Bronco/Ranger sales and profit compared to Focus?

Sales haven’t even come close to Focus when it was even in 2018 when it ended. Profits are definitely higher which is your point. 

[akirby]

29 minutes ago, fuzzymoomoo said:

Sales haven’t even come close to Focus when it was even in 2018 when it ended. Profits are definitely higher which is your point. 

Best recent focus year was 2012 - 245k U.S. sales.  Bronco and Ranger should easily do 250k after this year assuming no supply chain issues.  

[ice-capades]

2023 Ford Mustang Mach-E Gets 84 Month Financing Rate Cut

https://fordauthority.com/2024/03/2023-ford-mustang-mach-e-gets-84-month-financing-rate-cut/

 

 

With inventory levels remaining quite high even as we transition to the 2024 model year, The Blue Oval has taken quite a bit of action to move its remaining 2023 Ford Mustang Mach-E crossovers off dealer lots in recent months. That includes rolling out significant price cuts for those models – with Job 1 builds proving to be the better bargain thanks to the fact that they have more standard equipment – making the EV eligible for X-Plan pricing, slashing the cost of demo models, and rolling out new Red Carpet Lease Deals, along with introducing a new incentive that makes leasing a 2023 Ford Mustang Mach-E just as cheap as a Tesla Model Y. Now, those eyeballing a 2023 Ford Mustang Mach-E can take advantage of yet another new offer, according to CarsDirect.

 

This latest incentive comes in the form of an enticing 84-month financing rate, which can be as low as 1.9 percent currently, depending on one’s credit worthiness. It’s a sharp cut compared to the prior 84-month rate of 5.9 percent, and it means that one can potentially score a low monthly payment if they are able to combine the aforementioned deals, too.

 

In fact, if one can find a 2023 Ford Mustang Mach-E base model – which costs $41,695 at the moment, following the prior price cuts – and finance it for 84 months at this low rate, it would result in a monthly payment of $530.50, with just $3,000 in interest charges over the life of the loan.

 

Choosing a shorter term can result in even steeper savings for well-qualified customers, as 72-month financing terms are currently as low as zero percent, and that deal can be stacked with $3,000 in bonus cash as well, though it applies to higher-trim models. Either way, those that have been waiting for the right time to buy a Mach-E might have very well found it, if they can locate a suitable 2023 model that meets their needs, that is.

Edited March 1 by ice-capades
Additional Content

[jpd80]

This could be just me but I think that the last thing BEV buyers would want is to be stuck with

long finance deals, the rate that technology improvements coming will mean many BEV buyers

will be looking for vehicles with better batteries and greater overall efficiency.

 

Ford needs to be offering killer two year and three year leases with those low rates and guaranteed

buy back price. That would be the best method for moving on all the 2023s that Ford is now stuck with, gotta entice people….

 

 

Edited March 1 by jpd80

[Deanh]

50 minutes ago, jpd80 said:

This could be just me but I think that the last thing BEV buyers would want is to be stuck with

long finance deals, the rate that technology improvements coming will mean many BEV buyers

will be looking for vehicles with better batteries and greater overall efficiency.

 

Ford needs to be offering killer two year and three year leases with those low rates and guaranteed

buy back price. That would be the best method for moving on all the 2023s that Ford is now stuck with, gotta entice people….

 

 

issue with Ford if everyone leases, THEY are on the hook for potential lease end losses....whichbased on BEV resales, and technology gains year over year...is an extremely  scary prospect.. 

[Flying68]

13 minutes ago, Deanh said:

issue with Ford if everyone leases, THEY are on the hook for potential lease end losses....whichbased on BEV resales, and technology gains year over year...is an extremely  scary prospect.. 

The backend value is somewhat buoyed by the recycling value of the batteries and motors. So the OEM can keep that residual somewhat higher and minimize potential losses.

[jpd80]

12 minutes ago, Deanh said:

issue with Ford if everyone leases, THEY are on the hook for potential lease end losses....whichbased on BEV resales, and technology gains year over year...is an extremely  scary prospect.. 

Absolutely but the only way out of shifting so many 2023 Mach E is to subvent the whole issue

by shoving them into 1) internal fleets, 2) dealer courtesy vehicles and 3) killer leases for retail buyers.

 

I smile at the irony of this situation and the absolute hubris of Ford a year or so ago when it was planning

to cut out dealers for the online ordering process, sure they might want to be like Tesla but the truth is that

Ford cannot and will not deal directly with customers and their ordering issues.

[jpd80]

12 minutes ago, Flying68 said:

The backend value is somewhat buoyed by the recycling value of the batteries and motors. So the OEM can keep that residual somewhat higher and minimize potential losses.

Yeah about that, nobody has actually started recycling those massive car batteries yet

and I remain unconvinced that any manufacturer is really engaged in anything more than 

just basic good will propaganda…

[Deanh]

2 hours ago, Flying68 said:

The backend value is somewhat buoyed by the recycling value of the batteries and motors. So the OEM can keep that residual somewhat higher and minimize potential losses.

tell that to the people 25k in the hole after 3 years of ownership.....the buying public doesnt care how it effects the OEM in the slightest....

Edited March 1 by Deanh

[Flying68]

7 hours ago, Deanh said:

tell that to the people 25k in the hole after 3 years of ownership.....the buying public doesnt care how it effects the OEM in the slightest....

I don't know how that is relevant to the current discussion about subsidized leases and how Ford would be on the hook for the potential loss of on the backend of the lease.

 

Consumers can be dumb sometimes. It isn't my fault they overspent and may have paid ADM on a vehicle they didn't fully understand. Nor is it my fault they are looking to get out. They could just hold onto there vehicle for 8 to 10 years and get there value out of the vehicle. Currently there are some consumers that are going to get great deals with zero money factor leases and residuals higher than actual depreciation.

 

Now back to the discussion about Ford's potential losses on the backend of the leases. If they set residuals too high, there losses are limited by the recycle value of the batteries and permanent rare earth magnets. So potentially EVs have a higher floor price based on value of the sub components, even ones in a degraded or failed condition. So the loss is limited by the difference in residual minus the actual scrap value of the vehicle.

[akirby]

1 hour ago, Flying68 said:

.

 

Now back to the discussion about Ford's potential losses on the backend of the leases. If they set residuals too high, there losses are limited by the recycle value of the batteries and permanent rare earth magnets. So potentially EVs have a higher floor price based on value of the sub components, even ones in a degraded or failed condition. So the loss is limited by the difference in residual minus the actual scrap value of the vehicle.

You don’t crush and recycle a 3 year old vehicle because the residual is too high.  You sell it for $20k instead of $30k.

[jpd80]

19 hours ago, Flying68 said:

 

Now back to the discussion about Ford's potential losses on the backend of the leases. If they set residuals too high, there losses are limited by the recycle value of the batteries and permanent rare earth magnets. So potentially EVs have a higher floor price based on value of the sub components, even ones in a degraded or failed condition. So the loss is limited by the difference in residual minus the actual scrap value of the vehicle.

With respect, you’re over complicating this.

Consider what the Mach Es owe Ford - the production cost minus what is recovered by leasing

Additionally, factor in a small profit on the disposal price  after  the original  lease is completed.

Normally, that’s how manufacturers get a failed or slow selling vehicle off their books..

Edited March 3 by jpd80

[Deanh]

On 3/1/2024 at 9:03 PM, Flying68 said:

I don't know how that is relevant to the current discussion about subsidized leases and how Ford would be on the hook for the potential loss of on the backend of the lease.

 

Consumers can be dumb sometimes. It isn't my fault they overspent and may have paid ADM on a vehicle they didn't fully understand. Nor is it my fault they are looking to get out. They could just hold onto there vehicle for 8 to 10 years and get there value out of the vehicle. Currently there are some consumers that are going to get great deals with zero money factor leases and residuals higher than actual depreciation.

 

Now back to the discussion about Ford's potential losses on the backend of the leases. If they set residuals too high, there losses are limited by the recycle value of the batteries and permanent rare earth magnets. So potentially EVs have a higher floor price based on value of the sub components, even ones in a degraded or failed condition. So the loss is limited by the difference in residual minus the actual scrap value of the vehicle.

its about risk factor and potential losses...on a purchase the Buyer takes it inthe shorts if resale sucks...on a Lease if Ford sets a residual of say 35k after 3 yerars and the resale number when the car is returned at lease end is 25k, thats a net loss no matter how you look at it...Ford owns the car on a lease, THEY take the risk...which, as stated takes the Consumer out of the fledging resale market regarding BEVs. 

[Flying68]

2 hours ago, Deanh said:

its about risk factor and potential losses...on a purchase the Buyer takes it inthe shorts if resale sucks...on a Lease if Ford sets a residual of say 35k after 3 yerars and the resale number when the car is returned at lease end is 25k, thats a net loss no matter how you look at it...Ford owns the car on a lease, THEY take the risk...which, as stated takes the Consumer out of the fledging resale market regarding BEVs. 

From a consumer standpoint I wouldn't buy an EV unless it was really cheap.  I think we are quickly learning, even in the Tesla resale market, that BEV's just aren't holding value well.  Some of that is infrastructure, some is replacement / repair cost where for a consumer the floor value is near 0 (there is scrap value) if a battery dies.  Some of it is pace of technology, and some is the OEM pricing changes.  Tesla hosed over their customers when they slashed prices, causing the resale/trade values to plummet.

 

I think for an OEM (Ford, GM, Stellantis) the calculation changes.  The manufacturing cost is what it is.  However, they also have regulatory compliance costs, which just goes straight to the pockets of Tesla.  So for Ford, if they sell below manufacturing cost, that is balanced by whatever regulatory benefit they may gain, which still may be negative.  On the lease, Ford still books the same sale/loss but the ownership transfers to Ford Credit.  Ford Credit in turn has options of what to do with the vehicle at lease end.  If they determine the recycle value of the car is greater than "sell" value they can keep it and send those batteries and components back to Ford for remanufacturing. 

 

It will be interesting in the next couple of years when all the Mach-e's and Lightnings come off lease, pretty sure there was a clause that Ford Credit had the right to refuse buyout and take back ownership, not that anyone would want to buy it out.  I wouldn't be surprised to see Ford Credit do a program to lease a used Mach-e or Lightning for 2 to 3 years to get people into them that are priced out of the new market or do commercial leases to fleets.