As raw materials become ever more expensive, many automakers are resorting to cost cutting and layoffs in order to stay competitive. However with the price of steel jumping $500 per vehicle since January, even these drastic measures haven't been enough, and some are resorting to price increases to cope. Chrysler, BMW, and GM have already hiked MSRPs across their lineups, and Nissan may possibly follow suit. And now even Toyota is feeling the pinch, saying there's a possibility it "won't be able to avoid" charging more for its vehicles soon.
With the economy slowing and auto sales on the decline Toyota has been bracing for a tough 2008, but recently the automaker was forced to reduce its sales forecast for the year even further. According to spokesman Paul Nolasco the company is still focused solely on cutting costs, but word is that a decision on raising prices could come as soon as July. Toyota is hesitant, however, because it doesn't want to weaken its position in the highly competitive global market. Then again it may not have a choice -- Ghosn also said that Nissan may not raise its own prices until Toyota does, forcing the world's largest automaker to make the first move.
Nolasco insists that no decisions have been made yet, however if Toyota does increase sticker prices the hike may only affect cars sold in Japan. According to reports the automaker is currently evaluating its April through June sales against production costs, and could wind up raising prices for all its Japanese-market vehicles soon. And while this means the U.S. is spared for the moment, if the dollar continues losing value it's possible American-market Toyotas will eventually follow suit.
Source: Automotive News (Subscription required)