Ford cuts prices of Mustang Mach-E after Tesla moves

By David Shepardson

WASHINGTON (Reuters) -Ford Motor Co said on Tuesday it is cutting prices on its Mustang Mach-E electric vehicle and reopening orders after a series of price cuts by rival Tesla (NASDAQ:) Inc, the second time it has reduced prices this year.

The No. 2 U.S. automaker said it is also increasing the range for standard-range battery models as it increases production in the second half of the year.

Ford said it is cutting most Mach-E prices by $3,000 or $4,000 depending on the version or by as much as 7.8%. The price of the Mach-E Premium rear-wheel drive version is dropping from $50,995 to $46,995.

Ford shares were down 2.7% at $11.73 at midday on Tuesday.

Last month, the federal EV tax credit for the Mach-E fell by half to $3,750 from $7,500 after new battery sourcing requirements took effect.

Mustang Mach-E U.S. sales fell 20% in the first three months of the year.

In January, Ford cut prices of the electric crossover SUV Mustang Mach-E by as much as $5,900 per vehicle after hiking prices in August by $3,000 to around $8,000, citing supply-chain issues and higher material costs.

Ford said on Tuesday all standard-range models will now be powered by lithium iron phosphate (LFP) batteries, which allows vehicles to gain an additional 45 units of horsepower and improves the targeted EPA range estimates.

On Monday, Tesla raised prices in a range of up to $290 in Canada, China, Japan and the United States, its website showed, after the company had slashed prices on its top-selling vehicles since the start of the year.

The hike was Tesla’s first on its two top-selling models at the same time in multiple markets, although prices across its lineup are much lower than in January, after a round of discounts.