In the wake of dramatic sales declines in high-profit, full-sized SUVs and pickups, General Motors marketing chief Mark LaNeve says prices for cars and crossovers will rise.
“The challenge for the industry from a revenue standpoint is--revenue has disappeared due to the truck market declines, higher commodity prices, the cost to develop technology to meet CAFE and other regulations,” said LaNeve, GM’s vice president of vehicle sales, service and marketing, during a conference call on Thursday. “So prices are going to have to come up over time, and I believe we’re already seeing it. We’re seeing similar moves from our competition.”
LaNeve wouldn’t predict how much vehicle prices might rise or when all automakers might boost prices. He said GM’s competitors have started to raise prices and “we all have to be competitive in pricing.”
When pressed about whether price increases would appear in vehicle sticker prices, LaNeve said, “However you get there--higher MSRPs, (lower) actual incentives or higher transaction prices or a combination.”
GM has 14 launches coming in the next 18 months, 13 of which are cars and crossovers, said Mike DiGiovanni, GM’s executive director of global market and industry analysis.
Sales of GM light trucks suffered big hits in April. GM’s truck sales fell 26.5 percent in the month to 140,098 units. In April 2007, GM sold 190,678 light trucks.
GM CFO Ray Young indicated in March that GM was considering raising vehicle prices.“We'll be aggressive in our pricing,” Young told analysts in the March conference call. “At the end of December, we increased prices in the U.S. by 1.5 percent on average for our vehicles to offset some of the increase in commodity prices.”
At that time, Young added that GM will continue to respond to rising costs by raising prices on some vehicles.
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-----The orginal Mr.Goodwrench on the JBO since 11/99-----
Bound to happen as everything else in the world keeps going up.
wait, pickups and SUV sales are declining!?! you mean, GM's bread and butter!?! who would've guessed that?
