Toyota to raise cars prices in the U.S.

Toyota will raise its prices in the U.S. due to high raw material prices and the weakening U.S. dollar increasing the cost of production significantly. The move comes during a global downturn for car sales and a time when Toyota is facing its first profit drop in almost a decade.

Toyota’s sales momentum has remained strong given its focus on fuel-efficiency and reliability and this trend will likely remain unchanged once the new prices are introduced. The first hike is for cars imported to the U.S., while locally manufactured cars, such as the Camry (pictured), will see their prices rise later in the month.

According to the Associated Press, the petrol-electric Prius will get a price hike of around 1.8%, meaning the base model will be around $380 dearer while the Touring model will be around $420 more expensive. The Toyota Yaris will also raise its prices by around 1.7%, meaning the base model which costs around $11,350 today will cost around $11,543 on Monday.

While price rises are on the cards for Toyota customers in the U.S., the Japanese giant is also hopeful off boosting its bottom line with increased sales in emerging economies which are proving to have massive scope for growth. Toyota is set to build a new plant in India for a family of low cost cars designed to rival the Tata Nano.

Last week GM marketing exec Mark LaNeve said car prices will have to rise because stricter fuel-economy and emissions regulations, shifting demand to smaller and less profitable models as well as shrinking sales, and we suspect it won’t be long until a string of other carmakers make similar announcements.