While Rivian Automotive Inc (NASDAQ: RIVN) beat second quarter estimates and raised 2023 production guidance last week, legacy automakers revealed they have hit speed bumps on their EV route. On Thursday, Ford Motor (NYSE: F) postponed the launch of the all-electric Ford Explorer from the initially planned early 2024 to the summer of 2024. Also on Thursday, General Motors (NYSE: GM) revealed it is still having issues on the Ultium battery front which are slowing down its EV production.
Meanwhile, EV king Tesla Inc (NASDAQ: TSLA) just revealed today it has again cut prices in China, making it even harder for others to catch up.
Ford Is Facing EV Setbacks
The EV that will debut on the European market next summer will be built on a platform of Volkswagen AG (OTC: VWAGY) in Germany. Ford already revealed its EV segment is slated for a loss of $4.5 billion this year which is $1.5 billion more than initially expected. Ford CFO John Lawler also did not provide an exact date for the 2 million EV annual output that was previously targeted for 2026.
General Motors Is Also Having EV Struggles
Reuters reported that GM CFO Paul Jacobson stated on an investor conference that the company's EV output has been slowed down due to production issues of its new Ultium battery packs that the automaker is co-producing with LG Energy Solution Ltd. Upon the warning battery news, GM shares tanked almost 6% on Thursday to their lowest level in more than two months. From January to June, GM manufactured only 50,000 EVs and the majority of them used the older battery pack. GM already missed its production targets last year. The most recent battery setback will mostly impact the production of the Cadillac Lyriq.
Tesla Cuts Prices In China, Yet Again
Just as price tensions started showing signs of abating, Tesla has once again struck by rekindling the price war. According to a post on its Weibo account, Tesla has lowered the prices of the Long Range and Performance versions of the Model Y by about $1,900. It seems that price competitiveness remains an ongoing theme in the Chinese EV universe.
Upon news, Tesla stock dropped 1.7% in early US trading, while the stock of its greatest rival in China, the country's best-selling automaker BYD Company Limited (OTC: BYDDY) tanked as much as 8.7% in Hong Kong. Li Auto Inc. (NYSE: LI) and Xpeng Inc (NYSE: XPEV) also slumped. This move is Tesla reacting upon its July report that showed a slowdown in orders due to the lack of new models to attract buyers with the shipments from its China facility tanking 31% to the lowest level this year. Tesla announced to be making the revamped version of the Model 3 sedan at the facility, but it did not offer any specifics. Meanwhile, BYD, Li Auto and Nio Inc (NYSE: NIO) have set new records on the shipment front in July. Early last month, Tesla and BYD, among others, pledged to maintain fair competition and therefore, stay away from abnormal pricing in the country, but the agreement was retracted only days later due to antitrust concerns.
All in all, it seems that has the weapon that Tesla used, the price cuts, did its job of crushing its EV competitors.
DISCLAIMER: This content is for informational purposes only. It is not intended as investing advice.