Automakers agree to 30% price hike for steel sheets

Japans Toyota Motor Corp. and Nippon Steel Corp. have reached a final agreement to hike the price of steel sheets for vehicles by some 30%. The consensus among industry watchers was that Toyota, with its immense purchasing power, would resist a substantial price hike and settle on an increase of about ¥10,000 (US$92.43) per ton. Even during negotiations with the steel maker, Toyota began preparing for the impact of higher materials costs, estimating cost growth of “over ¥300 billion (US$2.77 billion)” for fiscal 2008, said Senior Managing Director Takeshi Suzuki on May 8. Unlike Toyota, smaller automakers have little room to reduce production costs further. (May 16, 2008)