Ford, Tesla fight for EV truck dominance

The EV truck wars have begun. Ford announced this week it is slashing $10,000 of the price of its F-150 Lightning trucks, The Washington Post reported. That's a clear challenge to Tesla, which has dominated the EV market — and which, after years of delays, last week finally rolled its first Cybertruck off the company's assembly line at Austin, Texas. The gas-powered version of the F-150 has been "Ford's most popular offering," making the electrified version a "particular threat" to Tesla's standing.

Elon Musk, Tesla's CEO, seems ready for the challenge. "The Ford Lightning is a good vehicle, just somewhat expensive," he tweeted, "especially given the high interest rates these days for any kind of loan." That comment was "somewhat interesting," Electrek's Fred Lambert pointed out, given that the new Cybertruck's "pricing is unknown" so far. The Lightning's base model, meanwhile, will now be listed at $49,995.

Wall Street is already picking sides. "While I am a huge believer in everything Musk save politics," CNBC analyst Jim Cramer wrote, the F-150 "has more going for it than the Cybertruck." Ford investors didn't love the price-cut announcement — the company's stock slid — but Financial Times noted that previous Ford and Tesla efforts to reduce EV price tags for consumers "contributed to rising sales for both carmakers." Which truck will be more popular with consumers?

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

'High-end product' versus 'real work'?

The battle between Ford and Tesla won't be just about price points. It's about culture too. Ford CEO Jim Farley sniffed at the Cybertruck last month, the Robb Report noted, calling it a "cool high-end product parked in front of a hotel." Ford, he said, makes "trucks for real people who do real work, and that's a different kind of truck." There may be something to that, acknowledged Robb Report's Bryan Hood: The Cybertruck might end up being powerful, but Tesla's futuristic, boxy design makes it "hard to imagine the Cybertruck on a job site."

Then again, we're still not sure what we're getting out of the Cybertruck. Jalopnik's Owen Bellwood reported that the official photo released to celebrate the first truck to roll off Tesla's assembly line "almost entirely obscures the finished car." The truck in the photo is surrounded by workers so that the truck bed, wing mirrors and front end are impossible to see. "It's a cute photo," Bellwood wrote, but "it leaves a lot of questions unanswered."

Ford, at least, has a head start. The price cut comes as the company "aims to significantly increase production" of the Lightning, the Wall Street Journal reported. Ford has gradually ramped up production at its plant in suburban Detroit and "now aims to build about 150,000 electric trucks a year." But both Ford and Tesla face a significant challenge: "Ford is already losing money on the EVs it sells" while Tesla's aggressive growth has come "at the expense of near-term profitability."

'Not enough buyers'

The developments at Ford and Tesla come as the push to grow the EV industry appears to have faltered somewhat. Axios reported that car dealerships have a growing inventory of electric vehicles on their lots because there are "not enough buyers." What is popular right now? Hybrid vehicles, which combine EV technology with gasoline-powered engines — reducing carbon emissions from fully gasoline-powered vehicles, but not as much as EVs. But analysts say that "more charging infrastructure is coming" and that relatively high EV prices should be about the same as their gas-guzzling counterparts by 2025.

EV sales are rising, the New York Times reported. The sector increased sales by 48 percent from a year earlier in the second quarter. But those sales aren't growing as fast as car companies want them to, or as quickly as their ability to produce EVs has grown over the last year. Cost has probably been a factor. "I think there was a lot of hype about EVs, and people did their research and realized these are premium vehicles and they're not cheap," said one dealer. Slashing the Lightning's price tag is a step toward solving that problem. Now it's Elon Musk's turn to decide how much the Cybertruck will cost.