The past month has been an eventful month for Tesla and Ford. Electric vehicle maker Tesla has made waves by slashing prices to stimulate demand. Soon after, automaker Ford — which also now makes electric vehicles — followed suit by slashing prices on its Mustang Mach-E model range. Both companies recently reported quarterly results. Tesla reported earnings and revenue that beat analysts’ expectations, but Ford disappointed when Chief Financial Officer John Lawler added that its electric vehicle business is currently unprofitable. Ford’s electric vehicle sales – now at 3.6% of total monthly sales – are Wall Street’s main focus. Mach-E made Ford the second-best-selling electric car maker last year in the US, albeit far behind Tesla. In the midst of talking about the electric car price war, who will win: Tesla or Ford? Here’s what analysts have to say. Ford Bank of America in a January 30 note called both Ford and Tesla’s decision to cut prices “odd”. “Both TSLA and Ford cite demand outstripping supply, which means that price cuts will directly impact current profits and unnecessarily reduce future earnings potential.” ,” it said. “Based on the 2023E production targets set by Ford for Mustang Mach E volumes, we estimate Ford will need to produce/sell approximately ~33% (270,000= > 360,000) more vehicles to remain profitable. absolute and % profit. If the extra capacity doesn’t exist, then why drop the price?” However, it did note that Tesla may have an advantage in the short term as unprofitable, low-margin EV businesses will continue to face challenges until “massive scale” is achieved. Wells Fargo in a January 31 note said that Ford’s Mach E offers cheaper options than Tesla’s Model Y. “Ford offers more affordable add-ons for the Mach E than the Model Y,” citing examples such as the premium version. paint options and hands-free driving system. However, it was ultimately undervalued by Ford, giving it a target price of $10, which equates to a 30% discount. Morgan Stanley equity analyst Adam Jonas said the bank sees an opportunity for Ford to improve capital efficiency. He also pointed to cost pressures on Ford. “With rates growing at the fastest rates in recent memory, price cuts and mixes could put unusually high pressure on margins. Ford may wait for margins to fall before taking actions. next restructuring or is it trying to stay ahead of the pressure?” he say. Tesla Most analysts seem more optimistic about Tesla at the moment. “Tesla has a big advantage over Ford in terms of cars, because Tesla has three models, while Ford only has Mach-e,” Louis Navellier, chief investment officer at wealth management firm Navellier & Associates, told CNBC Pro. However, he added that Ford has an edge over Tesla with the F-150 Lightening electric truck; Tesla’s Cybertruck is not for sale yet. While Morgan Stanley has an outsized rating on both Tesla and Ford, it gives Tesla a higher upside potential at 17%, while Ford’s is at 4.7%, according to the bank. Jonas of Morgan Stanley said: “We believe TSLA can leverage its cost leadership in electric vehicles to drastically expand its user base and over time generate a % of revenue. higher from highly profitable/recurring software & services”. “Tesla is the only OEM [original equipment manufacturer] where EVs are not a zero-sum game in terms of volume or negative profit trade-offs,” Jefferies said in a recent January note. According to FactSet, analysts see prices on average. Ford shares are down about 1%.About 41% of analysts interested in the stock give it a buy rating.For Tesla, analysts have an average price target gain of 1.8% and 65 respectively. % has a buy rating on the stock.—Michael Bloom of CNBC contributed to this report.