Will Toyota Raise MSRPs?
As raw materials become ever more expensive, many automakers are resorting to cost-cutting and layoff tactics 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. Some are resorting to increased prices to cope. Chrysler, BMW, and GM have already hiked MSRPs across their lineups, and Nissan may possibly follow suit. Even Toyota is feeling the pinch, with 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 there is word 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-CEO Carlos 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 of its Japanese-market vehicles soon. And while this means the U.S. is spared for the moment, if the dollar continues to decline, it's possible the American-market Toyotas will eventually follow suit.
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As record fuel prices have automakers slowing down fullsize truck production (to the point of reassigning plants to produce cars), an unlikely survivor might poke its head through the wreckage at Ford: the Ranger. Originally slated to close in '09, the Detroit News reported that the current Ranger might live on until 2011, when its new global replacement will be ready. With its fuel economy and good sales numbers, the Ranger is the No. 2 compact truck, behind the Toyota Tacoma, even though the truck has not been redesigned in more than 10 years.
Salvation is not completely assured, however. Some updates would be required to keep the Ranger alive, no matter what, as the current truck doesn't have side airbags. These are required after '09 released vehicles, which is probably one of the bigger reasons why Ford wanted to kill U.S. production. This would be good news for the autoworkers at Ford's Twin Cities assembly plant in St. Paul, Minnisota, since the factory was scheduled to close at the same time as the Ranger production ended.
The Cooper Tire and Rubber Co. has reached a $1.2 billion deal to sell its automotive unit, which accounted for nearly half of its overall sales last year, the company said yesterday. The Cypress Group, an equity group based in New York, and Goldman Sachs Capital Partners, also based in New York, jointly bought the unit. Cooper-Standard Automotive is based in Novi, Michigan. The unit, which had revenue of about $1.66 billion in 2003, makes automotive fluid and sealing systems. Cooper, based in Findlay, Ohio, said it would use the proceeds to reduce debt, invest in tire operations, or repurchase shares.