The Ford Motor Co. (NYSE: F | F Price Prediction) plan was to use its installed base of millions of gasoline-powered F-150s as a large pool of potential buyers for its electric F-150 Lightning. The Lightning was competitively priced, which means it had another advantage. Some of the support of Ford’s share price was based on this strategy, as the leading edge of the transformation of the company into an electric vehicle (EV) powerhouse. Sharp increases in the price of the Lightning may undermine those plans.
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Ford’s public relations executives like to bury bad news in their press releases. A prime example is the latest one, which yells, “FORD F-150 LIGHTNING STANDARD RANGE INCREASED TO EPA-ESTIMATED 240 MILES; INDUSTRY-FIRST PRO TRAILER HITCH ASSIST NOW AVAILABLE; ORDER BANKS RE-OPEN WITH UPDATED PRICING.” The practice is embarrassing. The important part of the news was that the price of the pickup would rise by thousands of dollars because of component costs.
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Ford will honor the old prices for people if they have orders awaiting delivery.
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The new price makes the Lightning expensive by full-sized pickup standards and could thus harm demand, and perhaps harm it significantly. The top of the line Platinum Extended Package will now cost $96,874. The lowest priced Pro will cost $46,974. (Some Ford dealers have been accused of increasing prices beyond those Ford allows.)
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William Clay Ford Jr., Ford’s executive board chair, told The New York Times that “If this launch doesn’t go well, we can tarnish the entire franchise.” He likened the launch to “betting the company.” As Ford increases the price of the Lightning by such a huge sum, the head of Ford’s worries may be about to come true.
Ford’s $90,000 Lightning Cripples Sales
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Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.
McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.
His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.
A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.
TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.
McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.
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