Ford has responded to recent price cuts on electric vehicles by rival Tesla by slashing the cost of its own flagship EV, the Mustang Mach-E.
Tesla has cut the price of its EVs globally by up to 20% in recent weeks, sending competitors scrambling to adjust.
Ford said it will cut the price of the Mach-E SUV by US$5,900, which will make its entry-level option eligible for a US$7,500 US tax credit.
Production of Mach-Es is ramping up this year to 270,000 as Ford attempts to make inroads into Tesla’s lead in the EV market.
Jim Farley, Ford’s chief executive, tweeted: “Scaling will shorten customer wait times. And with higher production, we’re reducing costs, which allows us to share these savings with customers."
Analysts suggested the moves by Ford and Elon Musk’s Tesla mean a price war has started
"Tesla’s price cut was a major blow to the prospects of competing EV models and the Mustang Mach-E directly competes with Tesla’s Model Y," said Garrett Nelson, an analyst at CFRA Research, told Reuters.
Dan Ives at Wedbush, added: “Mini price war about to begin with EVs in the US with Tesla’s shot across the bow on price cuts.”