Aug 9, 2022 - Economy

EV prices charge ahead: Ford F-150 Lightning price spike highlights increases

Illustration of top down car on dollar skid marks

Illustration: Eniola Odetunde/Axios

Electric vehicle prices were supposed to be heading in reverse right about now. Instead, they're taking off.

Why it matters: Automakers and independent experts had for years projected steady declines in EV prices as battery costs receded, making the environmentally friendly technology a more affordable replacement for gas-engine cars.

Driving the news: Ford announced Tuesday that it's raising the price of the F-150 Lightning electric pickup by about $6,000 to $8,500, depending on the model, to a starting price of about $47,000 to $97,000.

  • The announcement follows recent EV price increases by several other brands, including Tesla, Rivian, Lucid and GMC.

By the numbers: The average transaction price of an EV in July was $62,893, up 14.8% from $54,797 a year earlier, according to Edmunds. That compares with an average of $47,198 for all vehicles in July.

  • The EV average includes only vehicles sold through dealerships, meaning it does not track direct-to-consumer sales of largely-more-expensive models like Tesla, Rivian and Lucid cars.
  • "We all wish there were more affordable (EVs) in the marketplace today — there are none," Edmunds analyst Ivan Drury tells Axios.

Between the lines: Spikes in raw material costs — including the price of nickel and lithium, which are key to battery production — have undermined efforts to drive down the price of EVs.

  • Despite more than a decade of EV and battery development, EV raw material costs are more than double the average of internal combustion engine (ICE) vehicle costs — $8,255 vs. $3,662 per vehicle, according to AlixPartners.

Of note: The popularity of models like the F-150 Lightning and Tesla's EVs have contributed to their price increases, Drury says.

  • "The products themselves have been so good and there’s so much demand," he says.

But, but, but: For EVs to spread to the masses, prices will need to come down — and there's "no indication" that will happen anytime soon, iSeeCars analyst Karl Brauer tells Axios.

  • "They're going the wrong direction and everyone knows that at the end of the day, price is the biggest factor in determining what people buy," Brauer says.
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