Tesla Ceases Cybertruck Production as Electric Pickup Market Struggles
Electric Pickup Market Faces Challenges Amid Tesla Cybertruck Discontinuation
By Mike Colias
Nov 10 (Reuters) - Tesla’s move to discontinue its Cybertruck next year is perhaps the highest-profile flameout in a category that automakers had once hyped: huge electric pickups.
Tesla’s Production Shift and Order Backlog
Tesla CEO Elon Musk said in a social media post on Saturday that the automaker would ramp up Cybertruck production at its Austin, Texas, factory to meet an "order backlog” before dismantling the assembly line around June or July. He said the wind-down would allow Tesla to produce more Cybercab robotaxis, which have yet to be sold commercially.
Cybertruck Sales Performance
But sales of Tesla’s stainless-steel, angular truck — once described by MotorTrend magazine as having a “stealth-bomber-refrigerator design theme” — sagged 28% this year through September, to about 11,600 trucks, according to an estimate from research firm Motor Intelligence.
That sales pace is far off the 250,000-truck annual level Musk once predicted. Musk's other big company, SpaceX, also bought Cybertrucks worth $131 million from Tesla at list price last year, according to a federal regulatory filing.
Challenges for Electric Pickups Across the Industry
More Money for Less Truck
MORE MONEY FOR LESS TRUCK
The market for large electric pickups has been a rough road for Tesla’s competitors, too. Even the Cybertruck’s relatively meager deliveries have outpaced sales of electric trucks from rivals General Motors and Ford Motor, where executives once had high hopes that battery-powered versions of their full-size pickups — their biggest moneymakers — would be major hits.
Detroit’s automakers pivoted to EV pickup trucks early this decade in part to fend off entries from Tesla and Rivian. GM, Ford and Ram maker Stellantis for decades have cultivated legions of loyal truck customers by offering pickups with ever-increasing levels of horsepower and towing capability.
Cost and Functionality Issues
But the companies have not been able to translate that formula to EV trucks, said Karl Brauer, executive analyst at vehicle research site iSeeCars.com. For one, the trucks are pricey, in part because their massive batteries are extremely costly. GM’s Chevrolet Silverado EV, for example, starts at around $62,000.
Second, the trucks often struggle to perform tasks that owners of internal-combustion pickups have come to expect, like towing a horse trailer or hauling heavy equipment.
“So in the end, you have to pay more money for a vehicle that is less functional,” Brauer said.
Automakers Go Smaller, Add Gas to Extend Range
AUTOMAKERS GO SMALLER, ADD GAS TO EXTEND RANGE
Ford CEO Jim Farley acknowledged those tough economics during an earnings call last year, explaining why the company would discontinue the Ford Lightning, the electric version of its popular F-150 pickup that had been a relative hit for a few years before demand cooled.
Shifting Focus to Smaller and Hybrid Trucks
“The larger the vehicle, the bigger the battery, the more pressure on margin because customers will not pay a premium,” Farley said.
Ford’s focus is now on a smaller electric pickup, the Fathom, which it plans to roll out late next year at a starting price of about $28,000.
Automakers also are looking toward hybrid technology to deliver truck customers the functionality they need in an electric form. Stellantis next year plans to launch an extended-range electric pickup truck, which will use a gas-powered generator to recharge the battery on the go.
(Reporting by Mike Colias in Detroit and Nathan Gomes in Bengaluru; Editing by Matthew Lewis)
