Global Auto Analyst Tom Narayan expressed concern about falling electric vehicle (EV) prices, which could potentially hamper automakers’ profitability.
What happened: Narayan, on CNBC’s “Last Call” on Wednesday, pointed out that electric vehicle prices appear to be trending downward. This could pose a significant challenge for automakers such as Ford Motor Company F in achieving profitability in the electric vehicle sector.
He said: “If prices continue to fall, it will be difficult to get there.”
See also: Tesla Q1 Earnings Preview: Is EV Giant No Longer a ‘Growth Stock?’ Analysts are cautious and want answers about the Model 2 robotaxi
Because matter: Narayan’s tweet comes on the heels of Ford’s CFOJohn Lawler, expressing concern about the rapid decrease in revenue due to the reduction in prices of electric vehicles. Lawler highlighted the company’s commitment to reducing costs in the electric vehicle segment to counter losses.
Before, Tesla Inc. TSLA had also announced significant price cuts across all trim levels of its electric vehicles in China, following a series of price cuts in the U.S.
Stellantis NV STLA CEO Carlo Tavares had previously warned against price cuts that could jeopardize profitability and potentially make automakers takeover targets.
Price action: As of Wednesday’s close, Ford shares closed at $13.26, Tesla at $160.55 and Stellantis at $24.95, according to Benzinga Pro.
Read next: Elon Musk reacts as ARK Invest analyst says ‘it will be very difficult’ for Tesla’s rivals to ‘catch up’ in pricing: ‘accurate’
Image via Shutterstock
Designed by Benzinga NeuroBy
Pooja Rajkumari
The GPT-4-based Benzinga Neuro content generation system leverages Benzinga’s extensive ecosystem, including native data, APIs, and more to create rich, timely stories for you. Learn more.
Market news and data powered by Benzinga APIs
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.