Tesla Drops Prices... Will Ford?

[Mach Daddy]

Even if you call yesterday's M.Y. price an ADM, this new lower price makes the Y very attractive. I’m going to have to update my pros and cons list.

I would feel the same if I was ordering anything else but the GT, since the price difference didn't change between the MY Performance and the MME GT.

From my friends and family, most in the mid-west are still inclined to go for a Tesla but on the coasts buyers don't want a too common Tesla. I do have friends that have bought the Y, but interestingly they were all trading up from a Model 3. A good number really like the Porsche Macan vs a Tesla.

I test drove the MY Performance and the acceleration is great, as expected on an EV, but the interior is so meh. The MY beats the MME in other specs, but both cars meet my basic requirements for a city car...as does the Volvo XC40 Recharge, Audi E-tron Q4 Sportback, Jaguar i-Pace and Audi E-Tron. So for me it's between an MME that I can customize and am happy with as soon as it's delivered, or a MY which I have to customize to make it feel like it's my own.

Having said that, if I was in Ford's shoes I would drop the price (since they said making it in Mexico will make it immediately profitable) and put a whole lot of pressure on Tesla....who seems to already be feeling pressure from competition.

Lastly, maybe Tesla's battery day on Sept 22nd will reveal something that may change my mind?

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[JellyBelly]

I am going to cancel my premium ER RWD order and simply go for MY. The final of the two are almost the same now but MY has the advantage of SC , AP, better range, dual motor AWD, faster 0-60, and better efficiency. No mention that no wait for 7500 back. At the current price point of MY, to me MME doesn’t really have advantage at all..

Definitely quite a few people will be thinking the same especially if one can get a Tesla Y in 4-8 weeks versus months for MME

 

[Mach Daddy]

I am going to cancel my premium ER RWD order and simply go for MY. The final of the two are almost the same now but MY has the advantage of SC , AP, better range, dual motor AWD, faster 0-60, and better efficiency. No mention that no wait for 7500 back. At the current price point of MY, to me MME doesn’t really have advantage at all..

Not to nitpick, but it seems odd to join the forum just to say that, no?

Regardless, I am glad you are choosing an EV.

 

[opennetus]

There are other advantages to having a lower MSRP vs higher MSRP with a tax credit. It is not really the same as just subtracting $7,500 and comparing. Examples:

Higher Sales Tax. If your state sales tax is 10%, you would pay $750 more.

Higher registration taxes. Most states base vehicle registration fees on original MSRP value. This is additional money paid every year and could result in a few hundred dollars of additional costs over time.

Higher insurance costs. Generally, more expensive vehicles will cost more to insure

Qualification for local incentives. Many states cap incentives based on MSRP. Higher MSRP makes it harder to qualify and can limit your trim options.

Higher loan payments. While you will hopefully get the incentive eventually, you can’t get it right away for a lower monthly payment. To get the same monthly payment, you would need a longer loan term often resulting in a higher interest rate.

You need a tax liability to get the full amount. This could be a problem for some, such as retirees; particularly those whose income tax is already tax-advantaged, such as with Roth account income. Or households that would like to buy a second EV or plugin hybrid in the same calendar year. Or perhaps you would like to cut your income tax in other ways such as business loss write offs, investment losses, etc.

Even not considering any of the above issues, the AWD, long range model Y is cheaper than the closest Mach-e comparable: the premium extended range AWD. That model is more than $7,500 higher in cost now.

Given that the number specs on paper are all better generally for the model Y, it really comes down now to how much the Mach-e’s unique styling and ergonomics is worth to you. And whether or not you believe Ford’s quality will be better.

Tesla I think is also less risky; you know Tesla will not abandon BEVs; that is their sole business and their stock is reaching crazy new heights right now; lots of investment money for future technology. Ford, on the other hand, has had their stock plummet big time and is more vulnerable financially to an economic downturn. If this car flops for Ford, they could just shift attention to hybrids, trucks, and broncos and, if so, we could see the R&D and OTA software updates grind to a halt. Ford has the option to cut their losses; Tesla does not.

 

[Billyk24]

I am going to cancel my premium ER RWD order and simply go for MY. The final of the two are almost the same now but MY has the advantage of SC , AP, better range, dual motor AWD, faster 0-60, and better efficiency. No mention that no wait for 7500 back. At the current price point of MY, to me MME doesn’t really have advantage at all..

To me, the horrible service experience, quality control issues, not true software claims, nearly 350 mile drive to the nearest service center from the retirement home are more than enough to hesitate a move towards Tesla.

 

[Billyk24]

Tesla I think is also less risky; you know Tesla will not abandon BEVs; that is their sole business and their stock is reaching crazy new heights right now; lots of investment money for future technology. Ford, on the other hand, has had their stock plummet big time and is more vulnerable financially to an economic downturn. If this car flops for Ford, they could just shift attention to hybrids, trucks, and broncos and, if so, we could see the R&D and OTA software updates grind to a halt. Ford has the option to cut their losses; Tesla does not.


Not so sure Tesla is on solid financial ground as they never made a yearly profit. Many feel their stock price is inflated and is Tesla just a two car company now with dismal "S and X" sales with no plans for newer versions? I won't go on further.

 

[ChasingCoral]

I am going to cancel my premium ER RWD order and simply go for MY. The final of the two are almost the same now but MY has the advantage of SC , AP, better range, dual motor AWD, faster 0-60, and better efficiency. No mention that no wait for 7500 back. At the current price point of MY, to me MME doesn’t really have advantage at all..

Teslarian Troll. Joined today to post this.

 

[portlandg]

Teslarian Troll. Joined today to post this.

Unless I have misread some posts on here, I didn't think Tesla had any credits left anyway, so agree with you.

 

[06VistaGT]

Teslarian Troll. Joined today to post this.

Maybe true, but his points are mostly valid. Based on pure specs, the model y holds a solid advantage over the mach e in most respects.

For me, the mach e is my choice for the styling, interior functionality, service network convenience, fit/finish advantage and my general affinity for Ford and Mustang.

I would be surprised if Ford had a 100% equivalent offering considering the head start that tesla has had. Compared to most others, Ford has by far come the closest to matching teslas capability, imo.

To each their own...

 

[generaltso]

I hope this Tesla price cut makes a lot of Mach-E reservation holders cancel their reservations so that mine will be built sooner

 

[eager2own]

Unless I have misread some posts on here, I didn't think Tesla had any credits left anyway, so agree with you.

You are correct that Tesla doesn't have the $7,500 credit, but he's not claiming it does. His point is that the initially lower price MY comes to the same as MME when you take into account the tax credit for the MME... but you do have to wait to take advantage of the tax credit. In other words, like @opennetus also explained, for him it's an advantage to have the lower MSRP up front than the same price only after taking the tax credit into account.

And I don't know if others are Tesla trolls, but I don't consider myself a troll on this site, and I am assessing how Tesla's move might change my decision. For many of the reasons expressed by @benboy12 a couple pages above on this thread, I have been leaning towards the MME GT Performance over the MY, but I also recognize that there are a number of positives on the MY column (least of which is not the fact that I can get MY in 1-2 months instead of the MME in 12-14).
The price drop on the MY Performance isn't quite $3,000 but there is one. For me, much will depend on how much the GT ends up costing with the Performance package and other "options" that are standard on the MY such as the panoramic glass roof. Hopefully this will be known in the next few months (although I realize it may not be until right before ordering opens in December) and I can make a decision.

 

[JCHLi]

I am going to cancel my premium ER RWD order and simply go for MY. The final of the two are almost the same now but MY has the advantage of SC , AP, better range, dual motor AWD, faster 0-60, and better efficiency. No mention that no wait for 7500 back. At the current price point of MY, to me MME doesn’t really have advantage at all..

Luckily the answer to the "wait for 7500 back" has already been provided and discussed. You do not need to wait, in fact you can get it even before you spend any money.

Sure the point was made about other impacts of a smaller MSRP such as sales tax. So it is good to consider all the impacts, great and small.

For me, and not surprisingly many other buyers, a Tesla wasn't what we wanted,. Even with a $3000 drop (are they having demand issues?) It still doesn't interest me.

 

[eager2own]

Luckily the answer to the "wait for 7500 back" has already been provided and discussed. You do not need to wait, in fact you can get it even before you spend any money.

Yes, but to say that there's no impact to timing because you can change your deductions just sounds good on the internet but can be a pain in reality.

To compare apples to apples: let's say you can buy one apple for $40,000; or you can buy another apple for $47,500 with a tax credit. Who would opt for the second and wait for the tax credit?
I know, you say you don't have to wait for the tax credit. Instead you can submit a request with your employer to lower the withhold over months and (assuming that the employer is willing to adjust fully given that some employers do require a minimum withhold), and over some months you recover the equivalent of $7,500, and then of course don't forget to submit to readjust your withhold to the previous amount with another request to your employer.
So even without taking into account the various other points raised by @opennetus, I still think that the apple at $40k today has an advantage.

 

[JCHLi]

Yes, but to say that there's no impact to timing because you can change your deductions just sounds good on the internet but can be a pain in reality.

To compare apples to apples: let's say you can buy one apple for $40,000; or you can buy another apple for $47,500 with a tax credit. Who would opt for the second and wait for the tax credit?
I know, you say you don't have to wait for the tax credit. Instead you can submit a request with your employer to lower the withhold over months and (assuming that the employer is willing to adjust fully given that some employers do require a minimum withhold), and over some months you recover the equivalent of $7,500, and then of course don't forget to submit to readjust your withhold to the previous amount with another request to your employer.
So even without taking into account the various other points raised by @opennetus, I still think that the apple at $40k today has an advantage.

I sure hope apples never cost that much! Of course I see your example and it literally compares apples to apples. However if there were, say granny smith apples versus honeycrisp, there would be the added factor of taste to consider.

My point is, the extra 'effort' to get your tax credit now instead of later, is a smaller consideration then the difference in taste preference for myself and many others.

Also, changing your withholding is not the only way to realize your tax credit immediately.

 

[06VistaGT]

I think the bigger issue is the fact that the mach e is not all that competitive without the tax rebate, at least from a price standpoint. Tesla benefits from several years head start, so I would not expect ford to match price on day 1. But the business model now is overly reliant on a short term tax rebate that is unlikely to be extended. What happens after that will be the key.

On the other hand, it doesn't seem that ford is struggling to sell the mach e this year. It will be interesting to see if future years sales are strong, or if ford elects to increase production or if some other factors (battery limitations?) drive pricing adjustments. Ultimately, I expect ford will sell at the price they expect to make the most total profit when factoring in sales volume, competitors, market influences, etc. A strict comparison to the model y may be overly simplistic, especially as the bev market is flooded with new options in the coming years.

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