GM exec: Car prices could jump

[Hurricane]

GM exec: Car prices could jump

By Tom Krisher, AP Auto Writer
DETROIT — U.S. automobile prices could rise significantly in the near future because of industry restructuring, rising raw materials and regulatory costs, General Motors' (GM) chief financial officer said Tuesday.
Fritz Henderson said the industry has less manufacturing capacity than in the past and therefore less pressure to sell vehicles cheaply just to move inventory.

It also faces higher raw materials costs, rising technology costs and increased costs from fuel economy and other government regulations, he said.

More here: http://www.usatoday.com/money/autos/...r-prices_N.htm

[GM lover]

I am not surprised, American auto companies have been keeping their prices the same for awhile it is time for a slight raise. Toyota does this all the time without giving a reason.

[unkillsam]

I hate reading these types of articles becuase you always have the yahoo's that comment after the article.

This one was really nice......

Raskolnikov wrote: 11m ago
GM should start making the Yugo. That would be a step up from what they have now.

[MOOSTOPHA]

now people will be saying that gm's trying to jack up prices for no reason.

[Lichtronamo]

duh.

[unkillsam]

Originally Posted by GM lover

I am not surprised, American auto companies have been keeping their prices the same for awhile it is time for a slight raise. Toyota does this all the time without giving a reason.

GM slashed the prices of it's car's, drastically in some cases, about 2 years ago.

Some increases are warrented. LTZ Malibu just increased $500.00 dollars.

What need's to be addressed is that before any cost increases are announced, the vehicles themselves must be absolutely class competive and by competive I mean top 2 or 3.

Otherwise the consumers will not understand why they are paying more and will revolt.

[logansowner]

For Christ sake, cars go up in price 200-500 every year anyway, this must be another CAFE regulations are the devil whiny article...

[unkillsam]

Originally Posted by MOOSTOPHA

now people will be saying that gm's trying to jack up prices for no reason.

Yet somehow the general public overlooks the fact that domestic cars still cost less then imports.

The "content" and "feature" card is often played to use a cop out, but GM's and Ford's latest offering have been squelching that arguement.

I yearn for the day that a Chevy can sell at sticker like a Honda can. Then maybe GM can make a couple billion and get people off their backs.

[unkillsam]

Originally Posted by logansowner

For Christ sake, cars go up in price 200-500 every year anyway, this must be another CAFE regulations are the devil whiny article...

$200 bucks is just inflation. He is talking about the addition of content to vehicles I think.

Ask somebody 2 years ago if a Malibu LS would sticker at $19,995.00 and they would have laughed at you.

I think Fritz was trying to say that all of GM's newly introduced vehicles will be similar, with cost going up but standard features and content going up as well.

[ScottyFLM]

okay, why isn't any other manufacturer complaining, and saying they have to push prices up?

[unkillsam]

Originally Posted by ScottyFLM

okay, why isn't any other manufacturer complaining, and saying they have to push prices up?

They are, do some searching around. GM's prices on cars are still a lot less then the imports.

Do some feature comparisons.

www.truedelta.com

[montrealvue]

GM can ask whatever price they want. The questions is, will people pay what GM wants to charge? In the end, GM really has little or no say in the matter.

[Geotpf]

Originally Posted by unkillsam

Yet somehow the general public overlooks the fact that domestic cars still cost less then imports.

The "content" and "feature" card is often played to use a cop out, but GM's and Ford's latest offering have been squelching that arguement.

I yearn for the day that a Chevy can sell at sticker like a Honda can. Then maybe GM can make a couple billion and get people off their backs.

The sticker prices are about the same (in general), but the price people actually pay is less (in general) at a domestic dealer. Plus, a used domestic vehicle will (in general) be much less than a used foreign vehicle of the same age, size, features, and mileage.

[tgagneguam]

I'm not so sure what the purpose of Fritz making these statements is. Many of the pressures that would be forcing GM to raise its prices-rising raw material and regulatory costs, for example-seem to have always been present to some degree. And even if they do force GM to raise prices, he mentions little of the factors that might suggest that prices will come under less pressure, or at least according to what the article says (I have not searched for a full transcript of Fritz's speech). As one example, I have to believe that although a minority portion of the cost of building a vehicle, I have to believe that the recently-won labor concessions will help to mitigate other factors causing a rise in the cost of producing vehicles. After all, wasn't GM touting the billions in savings from these initiatives?

It's hard to tell what's going to happen. At least from my perspective.

[Geotpf]

Actually, let's do a comparison. Base models, Chevy vs. Toyota. Obviously, there could be content issues here (Like is A/C standard? Power windows?), so take this with a grain of salt...

Yaris sedan: $12,885 (note: quoted prices on Toyota's website are lower because they add on a delivery fee of $660 for cars and $685 for everything else-I'm including that in my numbers)
Aveo sedan: $12,830

Corolla: $15,065
Cobalt sedan: $14,585

Camry: $19,230
Malibu: $19,995

Avalon: $27,735
Impala: $22,400

So, for sedans at least, except for the Avalon, Toyota and Chevy are within a grand of each other. And you could argue that Toyota is aiming more at the Buick Lucerne ($27,520) than the Chevy Impala with the Avalon.