Is Ford Motor Company (F) Playing the Waiting Game?

GM has also announced it will offer a seven-year interest-free loan on its Chevrolet Volt. This will likely drive up sales, and it shows the company has likely managed to decrease production costs. GM also reduced the price for the Volt by $4,000. Price reductions are a great indicator for Ford, which can see that it doesn’t cost as much to manufacture an EV. According to Reuters, it currently costs GM $75,000 to manufacture a Volt, which means the company is losing about $49,000 on each one that is sold. The firm is likely pricing the car low in comparison to production costs in order to boost sales and increase the appeal of its EV. Waiting and seeing what might happen in the market is a sound strategy by Ford.

What to expect

With the electric car market expected to reach 3.83% in 2013, up from 3.38% in 2012 and 2.23% in 2011, it looks like now might be the time for Ford Motor Company (NYSE:F) to really make a plunge into the electric vehicle market. Its competitors are showing growing sales that are beginning to make a dent in each firm’s total revenue. I expect that given the numbers being released about the appeal of electric vehicles, Ford will concentrate efforts and release an EV that can compete with the big dogs.

Phillip Woolgar has no position in any stocks mentioned. The Motley Fool recommends Ford and General Motors. The Motley Fool owns shares of Ford. Phillip is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

The article Is Ford Playing the Waiting Game? originally appeared on Fool.com and is written by Phillip Woolgar.

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