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Mitsubishi the Latest to Slash EV Pricing

Maker cuts i-MiEV battery car price by 20%.

by on Dec.04, 2013

Mitsubishi is cutting the price of its 2014 i-MiEV battery-electric vehicle by 20%.

Mitsubishi plans to drop the price of its little i-MiEV battery-electric vehicle by an “astonishing” 20%, making it the latest manufacturer to cut battery-car pricing in a bid to charge up demand.

Electric vehicle sales have been lagging well behind expectations this year in part, analysts say, due to declining gasoline costs that have made it less attractive to buy hybrids, plug-ins and full battery-electric vehicles, or BEVs. In fact, a new study of nearly 1,100 potential battery-car buyers indicates high pricing, rather than low range, is the single-biggest obstacle to building demand for the technology.

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A wide range of manufacturers, including Ford, Nissan and Chevrolet, have already trimmed their prices this year and there are signs that has helped turn on more potential buyers.

The 2014 version of the Mitsubishi i-MiEV will go for $23,845, which the maker describes as an “astonishing” $6,130 discount from the price of the 2012.  (There was no 2013 model.)  In Japan, it went even further, trimming the price tag by $9,000.

Few vehicles on the market could use more of a boost. Mitsubishi has sold just 1,018 i-MiEVs so far this year. While that was, in fact, double the volume for the first 11 months of 2012, demand plunged 74% in November – when the maker sold a grand total of 12 of the battery-cars.

The maker will also add new content when the new model arrives early next year, including heated seats, side mirror defrosters, rear stereo speakers, fog lights and daytime running lights.

It’s unclear how the new electrical devices will impact range for a vehicle that already had one of the shorter stated ranges of any battery car currently on the market, an EPA-estimated 75 miles.

So-called “range anxiety” has been a big concern for potential buyers.  The typical BEV on today’s market starts out after a full charge with little more range than a gasoline car might get when its low-fuel warning light is about to kick on.

A new survey by Navigant Research, a consulting firm in Boulder, Colorado, found 61% thought favorably of battery-electric vehicles and 67% had positive views of hybrids. That said, the general consensus is that prices are too high, a problem the survey said is more troublesome to potential buyers than limited range. According to Navigant, a full 71% said they wanted the price of an EV to be under $25,000, and 41% felt the price should drop to less than $20,000.

(For more on the Navigant battery-car survey, Click Here.)

A growing number of battery-car makers are trying to slip into that range.  Nissan was the first to slash its prices this year, though the most stripped-down version of the Leaf electric still goes for $29,650. After the $7,500 federal tax credit, however, a motorist can take one home for less than $22,000 – plus state taxes and fees.  The Chevrolet Volt plug-in, which combines 16.4 kWh of batteries and a “range-extending” gas motor, attempts to overcome the range issue but that drives its recently reduced price to a still significant $34,995 and up.

Ford and Honda have also cut battery car prices in recent months.

Results have so far been mixed.  Volt sales have been weak in recent months – November generated demand for just 1,920 of the plug-ins compared with 2,022 in October.  Nissan, meanwhile, sold 2,003 of the Leaf electrics, up a single unit from October.

On the whole, plug-based vehicles are expected to reach sales of nearly 100,000 for all of 2013, double last year’s volume and a full six-fold increase from 2011. That said, the prime driving factor has been the increased range of products available.

Cadillac will join the fold early next year with the ELR plug-in. At $76,000, however, it is clearly not looking for a mainstream audience. But there are growing signs that there’s a distinct niche for electrics at the upper end of the market where sales of the Tesla Model S has been going for as much as $100,000 fully-equipped.

(Click Here for a closer look at the new Cadillac ELR.)

But the bulk of the new battery-based offerings are targeting mainstream niches and there, buyers have made it clear they want prices down, even as range goes up.

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One Response to “Mitsubishi the Latest to Slash EV Pricing”

  1. Jorge M. says:

    They got no choice they need to get consumers to buy these impractical EVs to lower the fines for not being able to meet the absurd 54.5 mpg CAFE requirement soon to be imposed.