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Quick Hits: Toyota Jacks Up Prices


Brief scrutiny of today's headlnes.

Toyota (TM) says it will hike the price of its Prius and Harrier hybrids in Japan to cover the increased cost of steel and other materials.

The price increases are the first in Japan since 1992 without an accompanying new model with improved features. The company raised prices 10% in 1974 after the first oil shock.

According to Bloomberg, the base price of the Toyota Prius will increase by 3% to about $22,000; the Harrier sport utility vehicle also will increase by 3%, to about $43,000 in Japan. The base price of several commercial vehicles is expected to increase about 2%.

"Price increases in raw materials have been much larger than Toyota's cost reduction efforts are able to offset," the company said in a prepared statement.

Toyota's rivals are expected to follow with similar increases. The automakers have increased overseas prices, but have been reluctant to do so at home where sales are sluggish.

Toyota, Honda (HMC) and Nissan (NSANY) have forecast lower profits this year as the cost of materials rise and sales slow.

Nissan said it expects net income for the year ending March 31 to drop about 30%; Honda said net income may fall as much as 18% this fiscal year.

Toyota, maker of the Camry sedan and the Lexus luxury models, said profits fell 28% between April and June. It expects full-year profits to decline in 2008 for the first time in 7 years.
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