Ford F-150 Lightning prices

The biggest price decrease is on the pickup’s mid-level Flash trim, now priced $5,500 lower at $67,995. That was followed by $2,500 off Lariat models, now priced at $74,995, as well as a $2,000 reduction for XLT models, with a new price of $62,995.

Prices on the $54,995 entry-level Pro model and an $84,995 top-end Platinum model were unchanged.

Automotive industry price cuts

The cost reductions are the latest electric vehicle price changes for the broader automotive industry amid slower-than-expected consumer adoption. Ford’s cuts come three months after it adjusted Lightning prices, including increasing some model prices.

Ford on price cuts

“It’s part of the normal response to both where the market place is, our supply and where our inventory sits … which we do all the time,” Ford Chief Operating Officer Kumar Galhotra told reporters on the sidelines of an event at its F-150 plant in Dearborn, Michigan. “New technology like electric vehicles takes some time to find the right sweet spot and the balance.”

Galhotra declined to comment on the nature of the problems that caused the stop-shipment as well as on why gas and diesel versions of the F-150 were held for months after production started. He broadly said engineers constantly write software onto modules for the vehicles, which are all connected with modems, to detect any anomalies and determine defects.

“There were some several small issues,” Galhotra said. “Once we find the solution to them, we fix them and then we ship. … We try to find every single thing that we can.”

As per Ford, it referred to what it called an “unprecedented truck offensive,” saying it assembled 144,000 F-150 full-size and Ranger midsize pickups during the first quarter of the year that are making their way to dealers and customers. Roughly 92% of the pickups built were F-150 pickups.

Having a large number of vehicles is not a good thing for an automaker. It means more costs on their books and delayed deliveries to dealers and customers.

Incentives for dealers

Automotive News on April 4 reported that Ford has revived a controversial practice of goal-based incentives for dealers called stair-step programs to increase sales for the vehicles. Since February, the automaker, which did not immediately respond to a request for comment on the program, has been offering retailers escalating cash bonuses if they reach and exceed monthly F-150 sales targets, Automotive News reported.

Ford quality checks

Ford last year also delayed shipments of its larger Super Duty pickups, which are siblings to the F-150, for months to do additional quality checks and inspections following issues with recent launches that led to recalls and high warranty costs.

“We’re going to prioritize quality, always. These are very complex vehicles with complex launches. We want to take the time to make sure everything is good, everything is perfect,” Galhotra said. “And when we’re satisfied with the level of quality, then and only then we’ll start shipping to our customers.”

Ford has said its warranty costs contribute to a cost disadvantage of $7 billion to $8 billion annually compared to its traditional competitors.

Shares of Rivian (RIVN), which produces the comparably-priced R1T pickup, are down 6.5% and circling an all-time low.

The post Ford to Resume Shipment of F-150 Lightning with Price Reduction appeared first on Industry Leaders Magazine.

Rivian’s production upbeat forecast is a small positive for an industry reeling from the double whammy of high inflation that has dulled buyer appetite and price cuts at market leader Tesla to stimulate demand.

EV demand dim

Last month, Tesla CEO Elon Musk said he was concerned about the impact of high interest rates on car buyers, echoing caution from General Motors and Ford amid fears of a slowdown in demand.

Smaller rival Lucid cut its production forecast on Tuesday “to prudently align with deliveries,” sending its shares down 4%. It now expects to produce 8,000–8,500 vehicles this year, down from an earlier projection of more than 10,000.

“I’m actually surprised to be honest at how much we’ve seen others pull back,” Rivian Chief Executive RJ Scaringe said. “I think it’s going to create, unfortunately, somewhat of a vacuum of products in the market.”

He said that “shifts in buying behavior beyond the tail end of 2023” were not influencing Rivian’s investment strategy for cheaper R2 vehicles that the company expects to launch in 2026.

Rivian’s turn around

After multiple quarters of supply chain problems, Rivian may be starting to turn a corner, some analysts have said. But the company shocked investors with an earlier-than-expected bond issuance last month that sent Rivian shares crashing.

On Tuesday, it trimmed its capital expenses and loss forecasts for the year. The company was cutting costs through negotiations with suppliers and updates to components and systems, Scaringe said.

Rivian assembly line update

Rivian production will also stop for a week this quarter to update its assembly line which Scaringe said partly kept him from raising the annual production outlook even more ahead of a bigger shutdown next year.

“Rivian showed resilience,” said Alec Lucas, analyst at Global X on Rivian production outlook. “Rivian appears to be benefiting from a more favorable commodity pricing environment, order book realization and progress toward scale.”

Lucid result, 2023

He said Lucid’s 2023 results “were reflective of efforts to scale production as well as an ongoing restructuring initiative.”

Car prices at both Lucid, which is backed by Saudi Arabia’s Public Investment Fund, and Amazon.com-backed Rivian start at more than $70,000. That is similar to Tesla’s Model S luxury sedan, but much higher than the cheapest Tesla model at around $38,000.

Rivian has stayed away from cutting prices and has instead taken to making its Enduro powertrains in-house to reduce dependency on suppliers and slash costs.

The company previously said sales of its higher-priced SUVs have been strongly outpacing sales of its pickup truck R1T, improving the average selling price of its vehicles.

Last month, it reported third-quarter deliveries above market expectations.

The Newark, California-based company Lucid shares had a loss of 28% per share.

Rivian Amazon Deal

Rivian also said on Tuesday it will end its exclusivity deal to largest shareholder Amazon for its electric delivery van, opening the door for more customers around the world, but reiterated its commitment to fulfilling the order of 100,000 vans to Amazon by 2030.

Rivian said was speaking with other customers that are interested in the Rivian Commercial Vehicle platform, which underpins its electric delivery vans, but declined to reveal any names.

Rivian revenue

Rivian’s third-quarter revenue of $1.34 billion was largely in line with Wall Street estimates, while its quarterly loss narrowed from a year earlier.

Cash as of end-September was $7.94 billion, down from $9.26 billion three months prior.

Lucid’s quarterly losses narrowed as well, but its revenue fell short of estimates. Production fell nearly 30% to 1,550 vehicles.

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