Global Autos Analyst Tom Narayan expressed concerns over the decreasing prices of electric vehicles (EVs), which could potentially hinder profitability for automakers.
What Happened: Narayan, during CNBC’s “Last Call” on Wednesday, pointed out that the pricing for EVs seems to be on a downward trend. This could pose a significant challenge for automakers like Ford Motor Company (NYSE:F) in achieving profitability in the EV sector.
He stated, “If pricing keeps coming down it’ll be tough to get there.”
Why It Matters: Narayan’s tweet comes in the wake of Ford’s CFO, John Lawler, expressing concerns over the rapid decrease in revenue due to EV price cuts. Lawler emphasized the company’s commitment to cost-cutting in its EV segment to counter the losses.
Earlier, Tesla Inc. (NASDAQ:TSLA) had also announced significant price cuts in all trim levels of its electric vehicles in China, following a round of price cuts in the U.S.
Stellantis NV (NYSE:STLA) CEO Carlos Tavares had previously cautioned against price reductions that might risk profitability and potentially make car manufacturers acquisition targets.
Price Action: As of close on Wednesday, Ford shares closed at $13.26, Tesla at $160.55, and Stellantis at $24.95, according to Benzinga Pro.
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