E-Pickup Battle Escalates: F Cuts Price, TSLA Unveils Cybertruck
As electric vehicle technology continues to evolve, the once niche market of electric pickup trucks is transforming into a hotly contested battleground. In a bold move to protect its turf from burgeoning competitors, Ford F has aggressively slashed prices of its electric F-150 pickup, seeking to provide a more affordable option for potential customers in the electric vehicle (EV) market. The announcement of the price cut comes after EV king Tesla TSLA announced that its much-awaited and long-delayed e-pickup—Cybertruck— rolled off the assembly line. Is Cybertruck in crosshairs? And how does the competition in the e-pickup space look like now? Let’s discuss.
TSLA Finally Enters the Fray with Cybertruck
Tesla grabbed huge eyeballs when Musk first unveiled the prototype of Cybertruck in 2019. With a wedge-like shape, ultra-hard 30X cold-rolled stainless-steel body and armored glass windows, the design of Tesla’s Cybertruck is quite radical. Initially scheduled to hit the roads in 2021, the timeline of this futuristic pickup has been pushed back many times. After two years of delays, Tesla announced on Saturday that it built its first Cybertruck at its plant in Austin, TX.
Reportedly, Cybertruck preorders surpassed 1.6 millionbut it remains to be seen how many of these reservations will ultimately result in confirmed orders.
The e-pickup will be offered in three different configurations — Single Motor RWD with 250+ miles of range and a startup speed of 0-60 mph in 6.5 seconds, Dual Motor AWD with 300+ miles of range and a startup speed of 0-60 mph in 4.5 seconds, and Tri Motor AWD with 500+ miles of range and a startup speed of 0-60 mph in 2.9 seconds.
F Strikes With Massive Price Cut
Yesterday, Ford announced that it is slashing prices of its electric F-150 Lightning pickups by as much as 17%. The most cost-effective variant of F-150 Lightning Pro, targeting commercial buyers, now starts at $49,995, marking a $10,000 reduction but still higher than its initial sticker price of $39,974 when it was first introduced in April 2022.
The consumer-oriented XLT model has also undergone a similar price cut and now starts at $54,995. The price of the most expensive trim option was cut by about $6,000 to $91,995. By slashing prices, Ford aims to stay ahead of the competition, particularly as the industry continues to witness rapid changes and new entrants.
Musk's Comments Spark Curiosity
After Ford’s announcement of price cut, Tesla CEO Elon Musk tweeted, “The Ford Lightning is a good vehicle, just somewhat expensive, especially given the high interest rates these days for any kind of loan.”
Musk's remarks have left many wondering whether the pricing of the Cybertruck will be more competitive in comparison. It remains to be seen whether Musk's remarks lead to a more affordable offering or simply reflect his belief in the Cybertruck’s value proposition.
Farley’s Views on Cybertruck
During a recent interview with CNBC's Jim Cramer, Ford CEO Jim Farley boldly stated that he doesn't believe Cybertruck qualifies as a real truck and doesn't see it as a threat to Ford's customer base. He emphasized Ford's understanding of its customers in the realm of EV trucks and vans. Farley asserted that his company caters to real people who engage in real work. According to him, while the Cybertruck may appeal to the high-end market, Ford's trucks are designed for practicality and utility.
Quoting Farley, “It’s (Cybertruck) like a cool high-end product parked in front of a hotel. But I don’t make trucks like that. I make trucks for real people who do real work, and that’s a different kind of truck.”
The E-Pickup Showdown
Pickup trucks are quintessential American vehicles, the ultimate fusion of utility and freedom. The combination of the ruggedness of pickups and technically advanced and sophisticated electric solutions is paving the way for the availability of green versions of popular vehicles. Auto biggies realize the potential of the e-pickup market, which is set to explode in the coming years.
E-mobility startup Rivian Automotive RIVN was the first company to bring an electric pickup to the consumer market, beating other automotive giants. It unveiled prototypes of the all-electric R1T truck at the LA Auto Show in late 2018 and started deliveries in September 2021. The first-mover advantage that RIVN enjoyed in the e-pickup market appears to have diminished amid the escalating competition for electric trucks.
Traditional carmakers like General Motors GM, Ford and Stellantis STLA are also racing to bring electrified trucks to the market.
General Motors’ GMC Hummer EV was the second electric pickup to hit the market. Production of GMC Hummer commenced in late 2021 and nearly 850 units were delivered through 2022. The vehicle has a range of 350 miles on a full charge and can go up to 60 miles per hour (mph) in roughly 3 seconds. The customer deliveries of the GMC Hummer EV pickup experienced a significant slowdown in the first quarter of 2023, with only two units being delivered. In the second quarter of 2023, sales of GMC Hummer tanked 83% year over year. The low volumes could be attributed to limited battery supply or some ramp-up issues of the Ultium platform.
Early last year, GM officially unveiled its first electric truck under the Chevy brand at the CES gadget show. The company began building an electric version of its Chevrolet Silverado pickup earlier this year. Chevrolet Silverado e-pickup is projected to achieve an EPA-estimated range of 450 miles on a complete charge.
Currently, Ford seems to be winning this e-pickup race with the electrified version of the top-selling vehicle in America, the F-Series truck. F-150 Lightning e pickup — deliveries of which began in 2022 — has a 10,000-pound max towing capacity, 775 pound-feet of torque, up to 300 miles of range and a startup speed of zero-to-60 in 4.5 seconds. Sales of the e-truck totaled 4,466 in the second quarter of 2023, up 119% compared with the year-ago quarter and 4.1% in the first quarter of 2023.
Next year, Stellantis will embark on the production of its electric RAM pickup, named the Revolution. The Italian-American automaker introduced its all-electric 2025 Ram 1500 REV this April. Ram 1500 REV is the first battery-electric light-duty pickup truck from Ram Truck. The truck will be available in two choices, including a standard 168-kilowatt-hour battery pack with a targeted range of up to 350 miles and an optional 229-kilowatt-hour large battery pack with a targeted range of up to 500 miles.
STLA currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Parting Thoughts
An era of electric pickups is underway. Amid evolving consumer preferences and growing environmental concerns, e-pickups are fast becoming the new frontier in the automotive industry's race toward electrification. With GMC Hummer EV, F-Lightning Pro and R1T already in the market, deliveries of Chevrolet Silverado e-pickup and Cybertruck commencing this year and RAM 1500 set to roll out in 2024, competitive juices are flowing.
As the battle for e-pickup supremacy continues to heat up with Ford's price cuts and Tesla's first Cybertruck unveiling, consumers, competitors, and investors alike will be closely watching the impact of these aggressive strategies on the future of the EV market.
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