In a move certain to frustrate Americans looking to enter the electric vehicle market, Ford Motor Company announced Thursday that it was raising the price of its F-150 Lightning truck by a startling 9%, as Reuters reports.
The price hike is the second time the Big Three automaker has increased the cost of the vehicle in the past three months, and the third time in the past year, likely raising red flags among those who had contemplated such a purchase.
In bringing the entry-level price for its F-150 Lightning Pro to $55,974, executives in Dearborn pointed to the rising cost of raw materials needed for its manufacture, according to CNBC.
The development stands in stark contrast to the impressive price point announced when the truck first hit the market, which hovered around $40,000.
At that cost, the Lightning was viewed as a breakthrough in affordability in the electric vehicle market many Americans have long believed was out of reach, budget-wise.
Explaining the company's decision, a Ford spokeswoman stated that price adjustments are made “as a normal course of business” and cited “rising material costs, market factors, and ongoing supply chain constraints” as factors in this latest alteration.
As CNBC noted, the costs of essential vehicle materials including nickel, lithium, and cobalt have seen dramatic rises in recent months, realities acknowledged by the automaker.
As the Motley Fool noted Friday, news of the Lightning's price hike led to a decline in Ford Motor Company Shares, as the market took a closer look at the impact the move may have on company fortunes.
The downward trend in Ford shares came even as the company celebrated the Lightning EV's receipt of the highly coveted MotorTrend Truck of the Year award.
According to the outlet, Ford notched sales of over 2,000 of the electric vehicles in November alone, as it continues to bolster production capabilities, efforts which include adding another shift at the Michigan plant where they are made.
However, the price increase is, in the eyes of many investors, a warning sign that profitability on the truck may now be in question.
Even so, as CNBC reported, Ford remains optimistic, saying, “Demand for this breakthrough vehicle is strong and continues to grow” and adding, “we will continue to monitor pricing through the model year.”
Despite what may be noteworthy bumps in the road in terms of pricing concerns, Ford's optimism regarding an industry-wide shift to all-electric product lines remains strong.
As the Detroit Free Press reported earlier this month, Ford CEO Jim Farley boasted that the company had received firm commitments from roughly two of every three existing Ford dealers to go full steam ahead when it comes to adjusting their capacity to accommodate EV sales.
According to Farley, 1,920 of the nearly 3,000 Ford dealerships nationwide have signed on to what the company calls its “Model e Program” designed to facilitate the installation of electric vehicle charging infrastructure and the granting of service certifications and the like.
“We're betting on the dealers,” Farley explained to reporters earlier in the fall. “We're not going to direct [them]. But we need to specialize. … The main message I have for the dealers, which I've never said before, because I never believed it was true, is that you could be the most valuable franchise in our industry. But you have to pick, just like we're betting.”
Though California has already mandated that all new vehicles sold in the state be either electricity or hydrogen-powered by 2035, and numerous other states are eyeing similar requirements, the rapidly rising cost of products such as the F-150 Lightning is just one of the impediments many believe render such timelines unrealistic, at best.
Doubts about vehicle range and performance in cold climates, combined with the need for continuous, environmentally problematic mining of rare metals, reliance on traditional (often coal-powered) electricity generation, lack of charging infrastructure nationwide, and a host of other concerns only serve to emphasize just how much of a gamble Farley – and his counterparts across the auto industry – are taking by seemingly putting most their manufacturing eggs in the EV basket.