Tesla hikes prices as inflation hits EVs
Tesla yesterday raised sticker prices on all its vehicles, while Ford leadership warned that its EV profit margins have been erased.
Why it matters: Inflation and sky-high commodity prices are taking a toll across the economy, and EVs are no exception.
- Changing EV economics also reshape return expectations for investors.
Tesla: The price of its more "affordable" Model Y long-range jumped around 5% to $65,990 from $62,990.
Ford: The Mustang Mach-E has seen its profit margins wiped out by commodity costs, CFO John Lawler told analysts. The automaker in April abruptly increased prices on its Mach E, but swiftly reversed the move.
- Lawler also said that the company’s financing arm, Ford Credit, has seen an increase in late payments.
Yes, but: GM this week slashed prices on its Bolt EV models by as much as $6,300.
Zoom out: The CEOs of Ford, GM, Stellantis and Toyota this week sent a letter to Congress, calling on lawmakers to lift the per-automaker cap on the $7,500 EV tax credit.
The bottom line: EVs are a key part of decarbonization, and U.S. drivers seem to want them. But the vehicles equipped with the batteries and tech to assuage range anxiety — and offer a true alternative — will remain out of reach for most buyers for the foreseeable future.