Hyundai Raising Prices

Edward Niedermeyer
by Edward Niedermeyer
hyundai raising prices

High gas prices are a bitch. But other factors prevent the "build a small car, stupid" strategy from rescuing the auto industry. Like the fact that steel prices have increased 60 percent this year. In the compact car market, where price point is king and profit margins are razor thin, automakers are being forced to raise prices to maintain what little profits exist. Bloomberg reports that Hyundai will increase prices on its budget cars for the second time since June, due to high steel and other component costs. The good news: Hundai's US sales are down "only" 2.3 percent and actually up 1.3 percent since the last price increase. The bad news: even the second price increase "isn't enough to cover the higher costs, but it's hard for them to boost prices more without crimping sales.'' And it gets worse too. All of Hyundai's Korean production will endure stoppages this week, thanks to labor demands for a nine percent wage increase. With sister company Kia holding on to its rock-bottom pricing, it's no wonder that Hyundai is heading upmarket. But will consumers (particularly in crucial developing markets) follow?

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  • Shaker Shaker on Jul 16, 2008

    I dunno - T. Boone's "conversion" reminds me of a deathbed confession of a serial killer. (/hyperbole) But he certainly has a plan, whereas the Gov't has just been spinning in circles.

  • 50merc 50merc on Jul 17, 2008

    prndlol said "I’ve never been a conspiracy theorist, but it truly feels like evil forces are getting the upper hand in the global marketplace." You are quite correct. Those forces have many millions of members around the globe. It is remarkable that such diverse and dispersed participants achieve such coordination, but one observer said marketplace behavior is guided by a spirit called "The Invisible Hand."

  • Seabrjim Seabrjim on Jul 17, 2008

    You are correct 50merc. A fellow by the name of Epperson wrote the book called "the unseen hand." I have a copy somewhere...excellent if not scary reading.

  • Beelzebubba Beelzebubba on Jul 17, 2008

    I wonder if anyone is re-thinking the "inspired-by-Rubbermaid" panels made (in)famous by Saturn?