Ford extends its decline as rising EV inventories threaten its all-electric truck. Monday, Ford Motor (F) reduced the price of its F-150 Lightning EV vehicle after Tesla (TSLA) unveiled its first Cybertruck and hinted at competitive pricing for its electric pickup. Ford shares continued to decline on Tuesday, while Tesla shares fell.
In 2023, rising inventories and more expensive auto loans exert downward pressure on the prices of new and used vehicles. Cox Automotive reported last week that the industry’s electric vehicle inventory increased in June, ending the month with twice as many days of supply as new vehicles.
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Ford reduces Lightning EV costs.
Ford reduced the price of its all-electric F-150 Lightning pickup vehicle by $6,000 to $10,000 on Monday, citing increased battery capacity and decreased battery costs.
After the price reductions, the Lightning will begin at $50,000 plus destination fees. Due to supply issues and rising battery costs, the company increased Lightning EV prices multiple times after its 2021 début.
The price reduction for the Lightning comes just two days after Tesla announced the production of the first Cybertruck in Austin, Texas.
Tesla has not disclosed pricing for the Cybertruck. Elon Musk, CEO of Tesla, tweeted on Monday, “The Ford Lightning is a good vehicle, but somewhat pricey, especially given the high-interest rates on any type of loan today.” Although unclear, some have interpreted this to imply that the Cybertruck will be less expensive than its competitor, the Lightning.
In addition, investors want to know when Tesla will begin mass production and delivery of the Cybertruck. In the meantime, some analysts are concerned about Tesla’s overcapacity issues in the coming months.
In May of this year, Ford reduced the price of its Mustang Mach-E crossover for the second time. Tesla had previously implemented a series of price cutbacks.
Ford Stock, CRMT Stock
On Monday, Ford stock fell 5.9% to 14.09 per share on the stock market. Tuesday’s 0.4% drop in share price marked the fifth consecutive day of declines. Tuesday, Tesla stock declined 1.2% after gaining 3.0% on Monday.
On Tuesday, several U.S. EV equities rose, including those of legacy automakers transitioning to electric vehicles and startups.
General Motors (GM) increased by 0.6%. Rivian (RIVN), Lucid (LCID), and Canoo (GOEV) grew among EV startups.
Fisker (FSR) declined marginally. Nikola (NKLA) increased by nearly 14% on Tuesday, extending its gains after forming a partnership with BayoTech, which will purchase 50 Nikola fuel-cell large rigs.
A ‘Winner’ Amid Automobile Industry Strife
On Monday, America’s Car-Mart (CRMT) reacted positively to an analyst upgrade.
Vincent Caintic, an analyst at Stephens, upgraded America’s Car-Mart from equal weight to overweight, stating that it is “a winner regardless of whether industry turmoil continues or begins to recover.”
The analyst at Stephens also increased his price target for CRMT stock to $135. This is nearly double his previous target of $70 and 15% above Monday’s closing price.
America’s Car-Mart claims to assist clients with poor credit in acquiring affordable, high-quality used vehicles. Its stock is included in the Russell 2000 index for small-cap companies.
On Monday, Car-Mart stock rose 15.3% to 119.52. Tuesday saw a 2.1% increase in CRMT shares, now up more than 60% from their March lows.
