Manufacturing Costs Skyrocket for Ford's Mustang Mach-E

Manufacturing Costs Skyrocket for Ford's Mustang Mach-E

Manufacturing costs have recently spiraled out of control for the Mustang Mach-E.

­Well, that’s a cold hard slap of reality.

We often focus on solving “range anxiety” for electric vehicles, ensuring the infrastructure is in-place, along with quick-charge technologies and greater battery densities.

But in the process, we sometimes takes costs for granted, especially the ticket price.

Take, for instance, the bad news coming out of Ford — the iconic American automaker reported that rising battery material costs and inflation are causing manufacturing costs to skyrocket for the Mustang Mach-E.

While price increases across the board have helped preserve the automaker’s profit margins, they weren’t enough to offset the climbing costs of the Mach-E.

Apparently, a lot has changed in two years…

“We actually had a positive bottom line profit when we launched the Mach-E, commodity costs have wiped that out,” Chief Financial Officer John Lawler said last Wednesday at the Deutsche Bank Global Automotive Conference.

Since 2020, inflation and rising commodities have added about $25,000 to the cost of each Mach-E.

It’s a sad reminder that upfront EV cost are still a substantial hill to climb to go green.

According to Kelley Blue Book, the average price for a new electric vehicle is $56,437, compared to the overall industry average of $46,329, which includes conventional and EVs.

And while the annual operating costs for EVs is generally lower than gas-powered vehicles, making it cheaper in the long run to go electric, trouble with the battery pack (the priciest component of EVs) can push that “break even” point further out or even make it nonexistent.

Hopefully, Ford can corral its rising costs so the electric version of one of this nation’s most iconic automobiles doesn’t become a losing proposition.