2023-11-05 18:11:00
As demand for electric vehicles (EVs) appears to be waning, there is a growing movement among companies, including industry leader Tesla, to reconsider their rapidly expanding EV investments.
Manufacturers have indicated their intention to invest a total of approximately $100 billion (14.94 trillion yen) in North America with the aim of making EVs suitable not only for luxury car buyers but also for the general public. However, inflation and rising interest rates are making it difficult for general consumers to purchase cars, suggesting that the environment surrounding EV manufacturers is deteriorating.
For example, a Ford F-150 Lightning starts at regarding $50,000 before the $7,500 federal tax credit. By comparison, a basic gasoline-powered version of the same model starts at regarding $37,000. General Motors’ Chevrolet Blazer starts at regarding $37,000, while EVs start at $56,000 before taxes.
Speed Bump
Tesla sales dipped in the third quarter, despite drastic price cuts.
Source: Tesla sales data
Tesla CEO Elon Musk said Tesla may postpone plans to build a new $1 billion factory in Mexico. It’s a change from an investor event in March, when the company boasted that the company had grown by 50% last year.
GM has previously postponed plans to expand production of electric pickup trucks at a plant outside Detroit. The plant was scheduled to start producing the Chevrolet Silverado and GMC Sierra electric pickups next year, but that has now been pushed back to late 2025.
Ford Motor Co. has already announced that it will postpone $12 billion of its $15 billion EV investment plan. Chief Financial Officer John Lawler announced on October 27 that the joint construction of a second battery factory in Kentucky with South Korea’s SK-On will be postponed. Ford is also scaling back production of its electric vehicle, the Mustang Mach-E, at a plant in Mexico that it expanded this year.
Falling EV Prices
Automakers have disproportionately slashed US electric-vehicle prices.
Source: Kelley Blue Book data
Original title:Cooling EV Sales Have Tesla, GM and Ford Rethinking Investments(excerpt)
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