Tesla Cybertruck becomes the latest "victim" in the electric pickup market

Mike Colias

Reuters, November 10 - Tesla's decision to halt production of the Cybertruck next year may become the most notable failure in the "giant electric pickup truck" segment, once hyped by automakers.

Tesla TSLA.O CEO Elon Musk (link) said on social media Saturday that the company will ramp up Cybertruck production at its Austin, Texas plant to fulfill “backlogged orders,” then dismantle the assembly line around June or July (link). He noted that the shutdown would allow Tesla to produce more of its not-yet-officially-launched Cybercab robotaxi.

However, according to research firm Motor Intelligence, Tesla’s stainless-steel, angular pickup—which MotorTrend once described as having a “stealth-bomber-refrigerator design theme”—saw its sales drop 28% to roughly 11,600 units through September this year.

This sales figure is far below the 250,000 annual trucks Musk once forecast. According to a federal regulatory filing, another Musk-led company, SpaceX (SPCX.O), also purchased $131 million worth of Cybertrucks from Tesla last year at list price.

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Spending More, Getting Fewer Trucks

The large electric pickup market is equally bumpy for Tesla’s rivals. Even the Cybertruck’s relatively modest deliveries outpaced General Motors’ GM.N and Ford Motor’s F.N electric pickups—vehicles whose executives had hoped would become bestsellers as the electrified versions of their full-size pickups (their most profitable products).

In the early 2000s, Detroit automakers shifted toward electric pickups, in part to stave off competition from Tesla and Rivian RIVN.O. For decades, GM, Ford, and Ram’s manufacturer Stellantis STLAM.MI built a loyal customer base by continually offering trucks with greater horsepower and towing ability.

But according to Karl Brauer, executive analyst at the automotive research website iSeeCars.com, these companies have not yet replicated that success in electric pickups. First, these pickups are expensive—in part because their massive battery packs are extremely costly. For example, GM’s Chevrolet Silverado EV starts at about $62,000.

Second, these electric pickups often struggle to perform tasks internal combustion truck owners take for granted, like towing horse trailers or hauling heavy equipment.

“So in the end, you’re paying more money for a less capable vehicle,” Brauer said.

Automakers Shift Toward Smaller Models and Add Gasoline Options to Extend Range

Ford CEO Jim Farley acknowledged these stark economics during last year’s earnings call, explaining why the company halted production of the Ford Lightning (link)—the electric version of its popular F-150, which sold well in earlier years before demand cooled.

“The bigger the vehicle, the bigger the battery, the bigger the margin pressure, because customers aren’t going to pay a premium for it,” Farley said.

Ford is now focusing on a smaller electric pickup called the “Fathom,” set to launch by the end of next year with a starting price around $28,000 (link).

Automakers are also looking at hybrid technology to provide the features pickup buyers want in electric form. Stellantis plans to introduce an extended-range electric pickup next year that uses a gasoline generator to charge the battery while driving.

(To facilitate non-English speakers, Reuters has automated the translation of this report into several other languages. Due to potential inaccuracies or lack of context in automated translation, Reuters does not guarantee the accuracy of the automatic translation, which is provided solely for the reader’s convenience. Reuters assumes no responsibility for any harm or loss caused by the use of automatic translation features.)