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00:00Looking at Ford stock down one point six percent. Your take on the price cuts. Yeah, it's interesting. I mean, our colleague done a whole right the other day, right? Is this the start of the first evey price war with Tesla going first? I think there's mixed opinion on this, right. We write that this is Ford responding directly to Tesla. You know, from a demand perspective. But if you look at where they cut price risk, who is talking about an average forty five hundred dollar car that actually on the base model, it's a 900 dollar car in the most expensive tomorrow it's a fifty nine hundred dollar car. Why is that important? Because it brings those more expensive models in line with eligibility for the IRS. Seventy five hundred tax incentive, right. So it's both sides response to Tesla. But I also think Ford says we need to make these vehicles eligible for that broader federal discount. Yeah. Good news for evey buyers out there, particularly states. So what does it mean for margins, though, Ed, that they're presumably comfortable with thinner margins to get that market share? Yeah, I remember being in Los Angeles 2019 with Jim Hackett, the former CEO, when the marquee was unveiled and he said on camera, you can go back and look at it. This will be profitable from car or unit number one. Of course it wasn't. And part of that has been low volumes. Right. 2023 is really the year that the marquee is going to ramp up its production to the tune of many more tens of thousands of units that should aid that profitability profile. But again, this isn't a company transitioning from combustion engine to be not a pure play name. And they're still working out the economics. I love you, but at the Inflation Reduction Act, because it looks like maybe it actually is an inflation reduction act because like they have to lower their prices to qualify if they have to do it. And that's more of the reason. Are there other auto companies, even companies that have to do at the same time? Well, that's what I mean about referencing Donna Hose price for column because you know, the next domino to fall, so to speak, I assume is General Motors. What are they going to do in response to that crosstown neighbor, Ford and Tesla, but maybe they don't. I think, you know, the issue is still one of demand. Right. And Ford and General Motors are supply constrained. In other words, they're building so few units that the demand for their specific products outweighs their ability to supply right now for Tesla. That wasn't necessarily the case, but that's what we're waiting on, Alex.

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Ford Cuts Price of Electric Mustang to Take on Tesla

Ford Motor Co. is slashing the price of its electric Mustang Mach-E by an average of $4,500 in response to Tesla Inc.’s own recent cuts, stepping up the price wars in a slowing EV market. Bloomberg's Ed Ludlow reports. (Source: Bloomberg)

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