Toyota raises prices while Detroit cuts deeply [7.25.5]

[T Mac]

Toyota raises prices while Detroit cuts deeply

"Kondo, the head of Honda's American operations, said the Big Three's price cuts had not affected sedan sales. He said this was because surging fuel costs were leading consumers to look not only at sticker prices but also gas mileage.

But Kondo said the price cuts had hurt sales of pickup trucks, a market Detroit has traditionally dominated. For instance, he said sales of Honda's Ridgeline pickup truck would probably fall a few thousand vehicles short of its target of 50,000 this year. In response, Honda modestly increased rebates on the Ridgeline to $1,000 in mid-June, Kondo said."

By Martin Fackler
New York Times News Service

[csimo]

The facts are that both GM and Ford are in very serious financial condition. Toyota realizes that if they continue their sales trends GM or Ford may not survive as we know them today. Toyota also knows that such a failure might result in a huge anti-Asian backlash in the US market. They want to avoid such happenings.

It's also interesting that Honda used the 50,000 number for the Ridgeline. As I remember it started as a 40,000 unit 18 month sales goal, then was raised to 80,000 units.

Honda is not in same position as Toyota and would love to gain some market share. Honda/Acura has been throwing a lot of "hidden" back end money on some vehicles to try and stimulate sales. An unprecedented action on the part of Honda.

Honda is now on the verge of needing slowing down production at the Alliston Ridgeline/MDX/Pilot plant... first time in history. Dealer inventories are high and the 2006 MDX / Pilot have little new to offer to buyers. A 45+ day dealer inventory is not a good situation for Honda.