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Toyota To Raise Prices In North America

by Darren

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Toyota has been selling a lot of cars, but higher costs for the company are driving down profits. In fact, Toyota’s profits are shrinking in the U.S.A. The company has decided to raise prices in order to combat the erosion.

The Japanese maker has expanded aggressively outside its home market, helped by its reputation for fuel efficient vehicles, including petrol-electric hybrids, which have generated strong interest at a time of soaring oil prices.

But Toyota is widely expected in the current business year to March 2009 to suffer its first drop in operating profit in nine years because of sluggish US sales and a stronger yen, as well as surging costs of steel and other materials.

From those to be shipped from Monday, the price of the popular Prius hybrid will likely climb by 1.8 percent and that of the Yaris compact by up to 1.7 percent, the Nikkei business daily reported citing unnamed company sources.

The price increases are coming quick. Consumers can expect to see the first price cut on the Toyota Camry in May of 2008.