Ford Authority

Ford CEO Farley Says Model Y Price Cuts Were A ‘Huge Gift’

Over the past several months, the Ford Mustang Mach-E and Tesla Model Y have been engaged in a bit of a heated price battle, with both models getting notably cheaper over that period following multiple price increases that occurred during times of major supply chain disruptions. However, while one could assume that Tesla’s decision to slash the prices of the chief Mach-E competitor might irk Blue Oval brass, that apparently isn’t the case – at least according to CEO Jim Farley, who recently touched on that topic while speaking on the automaker’s Q3 earnings call with investors.

“A great product is not enough in the EV business anymore,” Farley said. “We have to be totally competitive on cost. Tesla actually gave us a huge gift with the laser focus on cost and scaling the Model Y. They set the standard, and we are now making real progress on our second and third cycle EVs that are in the midst of being developed today, as we get closer to the introduction.”

It’s somewhat surprising that Farley would consider such a price war to be a good thing given the fact that Ford is losing tens of thousands of dollars – on average – on every EV it currently sells. However, Farley previously admitted that pricing is one of the biggest barriers to EV adoption, though the automaker is working to make its second generation electric vehicles profitable, which is expected to happen in 2026.

With demand waning a bit, FoMoCo recently announcing that it’s delaying around $12 billion in planned EV investments, though it is testing the very same type of giga press machine that Tesla currently utilizes in an effort to reduce costs. Soon, The Blue Oval and its Ford F-150 Lightning, specifically, will gain another competitor from that same automaker as well – the Cybertruck – which recently entered production years after it originally debuted in 2019.

We’ll have more on everything Ford’s competition is up to soon, so be sure and subscribe to Ford Authority for 24/7 Ford news coverage.

Brett's lost track of all the Fords he's owned over the years and how much he's spent modifying them, but his current money pits include an S550 Mustang and 13th gen F-150.

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  1. Bob

    Dear Farley, like he reads any of this. Make a Maverick EV or a Ford Tornio EV which can tow.
    You can make them so much more aero.

  2. RichG

    Just not believable that he’s happy about the Tesla price cuts. I mean, this is just ridiculous.

    He needed another company to teach him to cut costs?????

  3. Lealand Young

    You can take it however you want but Tesla is going to be putting a lot of pressure on suppliers outside of whatever their vertical integration model doesn’t cover and since they are the big fish in the kiddie pool other manufacturers will benefit as a result. Not to mention other manufacturers can learn from Tesla as they do all the heavy lifting when it comes to cost cutting and take that model and see where they can fine tune it and that saves them a lot of money (like Gigacasting for instance, Tesla developed it and the rest of the industry can reverse engineer it at much less cost than it took Tesla to develop the technology and employ it on their vehicles).

    1. Mike

      A gigacasting machine takes a minimum of 24 months to construct, transport, reassemble on-site, and calibrate for production. And here’s the kicker: only one company in the world makes them, and they were backlogged as of last year. Tesla, however, has a 16-ton gigapress about to be delivered, with more lined up right behind it. So, if you’re just now considering gigapresses, you’re in for some bad news.

      But that’s not all. It also requires extensive alloy research to develop the casting material with the specific properties needed for your vehicle. Reverse engineering and funding are just one side of the coin; the other is navigating the real-time tooling fabrication lag, when you’re already playing catch-up.

      1. Paul

        👍 Plus, Detroit doe not have a good tracker record implementing new technology.
        Some, including Tony Seba, are forecasting robotaxis/autonomous causing auto sales to further decline by 2027 or so. For the incumbents this may mean – by the time they have any viable competition – too little, too late.

    2. Paul

      By the time they do – doubtful – Tesla will be that much further ahead – not to mention their $23B cash vs. Ford’s $139B.
      Tesla’s unparalleled “Innovation at the speed of thought” (Sandy Munro) – Agile development methodologies for software AND hardware, some 26 problems/week where virtually every employee reports to a working Scrum team daily – vs. Ford’s legacy pyramidal glacial management structures? No contest.

  4. David Dickinson II

    “Denial” ain’t just a river in Egypt. Of course, when someone has drunk that much kool-aid, it will take a while to get it all out of his system.

  5. BK Big Fish

    I know this isn’t exactly the point of the article, but this IS a more official Ford site than most… regarding the “Ford is losing tens of thousands of dollars – on average – on every EV it currently sells.” That is just journalistic malpractice, and I’ve seen it everywhere.

    All they did is take Ford’s loss on its EV segment, and divide it by the number of EVs it’s sold. Which lumps in the billions of dollars of factory construction and R&D they are currently engaged it. It would be like, in 2012, saying that Tesla lost “$1 billion on every car it sold.”

    They’re implying – or they don’t realize they’re implying, which is even worse – that the marginal cost of each EV Ford builds exceeds its price by $36,000. That’s ridiculous.

  6. Samuel

    Americans don’t want EVs, as stated almost every recent automotive news article. The grassroots boycott against EVs has worked wonderfully. #BudLightEVs

    1. Joe Bob

      They are going to buy a million of them this year. I think they ARE done with the class of ev that costs more than Tesla but aren’t as good though.

  7. Mf

    “A great product is not enough in the EV space anymore”.

    Very true. Unfortunately, Ford didn’t have that, or a price advantage. Hence the failure of Mach E and Lightning. They tried to copy Tesla, down to the crappy portrait screens that even Tesla stopped using, and flopped big time.

    Tesla’s price cuts were a gift in that they could blame discounts and poor sales on just Tesla’s price cuts, and not admit they built a poor product.

    1. Mackie

      Were they failures? Minimal tooling investment to port existing platforms to make EVs and gain invaluable build and customer data, and a leg up on the competition? Ford also demonstrated they can quickly get EV products to market when the media ‘USED’ to say that Tesla was ‘decades ahead of the competition’, as we wait 4 years for the Cybertruck. At the end of the day, it will take a battery tech breakthrough across the industry before EVs make a big jump in total market share.

      1. Mf

        I mean, yeah… They were economic failures.

        The mach E especially, since that’s the competitor to the model y he was discussing. Mach E has a huge supply glut of them, has major issues with its power delivery, doesn’t turn a profit, and now is getting undercut by model y in price.

        As boring and lame as the model y is, at $52k for a performance model, it’s a pretty great bargain even without the EV tax credit. Mach E GT is slower and worse and than model y, with nothing to make it stand out. So yeah… It’s a failure.

  8. Dave Mathers

    So what Farley is saying is that prior to Tesla lowering their prices Ford was NOT focused on cost? Uh, really?

  9. David

    What Bob said! Maverick is a highly strategic platform for EV. Makes efficient use of costly batteries due to its physical characteristics of being small and narrow. Plus, I see all kinds of handymen, delivery services, gardeners, and pool guys already using Maverick, and those are duty cycles and use cases that makes total sense for EV.

  10. JD

    Ford, lead by Farley has past the rubicon on the catastrophic EV failure that’s headed its way. Nobody ever asked for or wanted the Lightning. Ford is hemorrhaging money on the impending lightning failure at such a rate that Henry Ford is spinning in his grave. The inventory levels of the lightning and the Mach-E are building so rapidly that Stevie Wonder can see what’s happening. Farley bragged about being able to make 150,000 lightnings per year. He’ll be lucky if he ever sells 150,000 total. Farley’s obsession with Elon musk and Tesla is embarrassing and the fact that he still has a job with Ford is shocking.

  11. Dan Akers

    Mr Farley has finally learned that you can sell quality and reduce price. It took long enough but that is the only way Ford might be able to sell enough vehicles to survive.


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