Michigan-based automaker Ford Motor Co F on Friday reported a significant 11% drop in electric vehicle sales in the U.S. this January, owing to a drop in demand for its Mustang Mach-E electric SUV.
What Happened: Ford sold 4,674 electric vehicles in January this year as compared to the 5,247 units sold in the first month of 2023. Sales of the electric Mustang Mach-E SUV took the most hit with the company selling only 1,295 units of the vehicle last month, marking a slump in sales of about 51%. The company also witnessed a minor drop in F-150 Lightning EV truck sales by 6 units as compared to January last year.
For the E-transit electric van, however, the year has kicked off to a good start, with sales bumping up 214% to 1,121 units.
Mustang Mach-E Turns Less Appealing To Buyers: The Mach-E electric SUV has a starting price of $42,995, less than its rival Tesla Model Y which starts at $43,990. However, Tesla Inc‘s vehicle is eligible for a federal EV tax credit of $7,500, bringing the cost of the vehicle down to just $36,490 for the customer.
The Mach-E lost eligibility for the tax credit at the onset of this year owing to the Biden administration’s latest guidance aimed at reducing Chinese content in batteries eligible for EV credits. Until the end of 2023, the vehicle qualified for a federal EV tax credit of $3,750.
Why It Matters: Ford witnessed a drop in sales only in the electric vehicle category. Hybrids, on the other hand, saw a 42.7% bump in sales, and combustion engine vehicles 2.6%. Overall, Ford sold 152,617 vehicles in January, with combustion engine vehicles accounting for 136,786 of them. F-Series remained the company’s best-selling truck with 48,702 units sold last month.
“Overall Jan. sales were up 4.3% and Ford is America's best-selling brand, outselling Toyota for the top spot,” Ford CEO Jim Farley said. “Great start to the year.”
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