Chrysler Raises Prices For 2008 Inventories
In response to rising costs of steel and other raw materials, US third-largest car maker, Chrysler LLC is raising prices by an average of 2 percent of its remaining 2008 vehicles. Noteworthy, the steel prices for automakers have risen $500 a vehicle since January.
According to Chrysler spokesman, Stuart Schorr, “Today’s economic conditions and future forecasts indicate unrelenting pressure as it relates to commodity prices, specifically steel, which have forced our hand.”
The price increase won’t affect vehicles that are already in dealers’ inventories, but it will affect the remaining 2008 vehicles that Chrysler will make during its summer buildout. The increase will take effect on vehicles shipped to dealers starting today (June 16).
Schorr further said, “The average 2 percent increase brings total model year price increases in line with key competitors. It does not affect vehicles already in dealer inventory. Incentives would not be changed.”
Chrysler said the increase will bring its models in line with competitors’ actions. General Motors Corp. has raised prices as much as US $1,500 in December because of higher commodity expenses.
In this context, Schorr said, “All manufacturers including us have taken small incremental price increases after the launch of the model year.” He further added, “The cumulative impact is that with our increase we are bringing the total model year increase in line with our key competitors.”
Reportedly, Chrysler’s sales were down 25 percent in May, as compared to May sales of last year. Through the first five months of the year, Chrysler’s sales were off 19 percent, with huge drops especially in larger vehicles.
