TOKYO — The soaring cost of steel has Toyota considering raising prices in Japan without a model makeover for the first time in three decades, the Japanese automaker said Wednesday.
Speculation has been rife Toyota Motor Corp. will be forced to announce higher prices in Japan — a move even Toyota acknowledges could be critically damaging for an already sluggish Japanese market.
Never miss a local story.
With steel prices surging, Nissan Motor Co. Chief Executive Carlos Ghosn has hinted he is waiting for its bigger rival to take the lead to make it easier for others to follow suit.
Japan's top business daily, The Nikkei, reported Wednesday that Toyota plans to raise prices only on some models, including the Prius gas-electric hybrid, by 1 percent to 3 percent.
”We are reluctant to raise prices in Japan because the market is so sluggish,“ Toyota spokeswoman Kayo Doi said. ”But we have no option but to consider it.“
Like other automakers, Toyota has previously raised its U.S. prices without major model changes. But the last time Toyota similarly raised prices on Japan models was in 1974.
Since then, Toyota has not raised prices in Japan except for remodeling, which happens only once every several years, in which improved features are added.
Toyota recently reported a 28 percent nose dive in fiscal first-quarter profit compared with the previous year. It is forecasting its first full-year profit decline in seven years as it faces more problems from the weakening U.S. market.
Last month, Toyota lowered its global vehicle sales plan for this calendar year by 350,000 vehicles to 9.5 million, blaming the sluggish North American market. This year, Toyota's growth in vehicle sales has been slowing to a pace of 1 percent, compared with a 6 percent climb in 2007.