Ford is offering a discount of 40,000 yuan on its Mustang Mach-E SUVs in China. The offer stands till the end of April. The vehicle is now available in China at 209,900 yuan in China after the discount. The price of its Mach-E was already slashed by $5,900 in the US after Tesla’s price cuts.
Ford said in November it was accelerating Mustang Mach-E production and targeting a global annual output rate of 270,000 by the end of 2023, including its China production. It builds the Mach-E in Mexico and China. Ford sold 39,458 Mach-Es in the U.S. last year, 45% more than in 2021. However, Mach-E sales last year in China, the world’s largest auto market, were minimal – just 7,782 units. Tesla sold 455,091 Model Ys in China in the same year, according to data from the China Association of Automobile Manufacturers (CAAM).
Ford is the latest to join the growing list of automakers offering discounts on their popular EV models in China to stimulate demand. After Tesla slashed prices on the Model 3 and Model Y in early January, Citi Analyst Jeff Chung said it would “create a negative spillover effect” on other automakers’ backlogs in China. It started with Chinese EV maker XPeng dropping prices by up to $5,300, with several auto manufacturers following. Last month, Toyota cut prices on its bZ4X electric SUV by 15%, with a new starting price under $25,000 (169,800 RMB).
Ford in China
Ford’s discount in China comes after already slashing Mach-E prices in the US by up to $5,900. It appears that Ford’s demand in China is slowing. Especially as the competition is heating up. With several brands such as BYD releasing cost-effective electric vehicle solutions and startups like NIO rapidly expanding in the region, legacy automakers are struggling to keep up.
However, Ford has also discounted prices in the US to keep pace with EV leader Tesla. The discounts could be part of Ford’s strategy to close the gap and accelerate sales. Despite Ford’s success in its home market, growing to become the second-largest EV maker in the US last year behind only Tesla, the market in China has proven more challenging to break through. Automakers are having their own strategies. Only as the sales records are revealed, it will be possible to know how the discounts have possibly helped in raising the demand and keeping up the sales. Meanwhile, certain automakers like Polestar have been denying the price cuts due to the reported minor loss in the fourth quarter last year.