GM and Chrysler Announce Price Hikes : Autos: The No. 1 and No. 3 U.S. car makers said the increases on ’92 models will help them keep up with inflation and offset higher production costs.

General Motors Corp. and Chrysler Corp., facing their worst sales slump in years, said Tuesday that they would raise prices of their 1992 model cars.

GM, the nation’s biggest auto maker, said prices for most of its 1992 model-year passenger cars will on average cost 3.1% more than comparably equipped 1991 models.

Struggling Chrysler followed suit, saying it will increase 1992 domestic car prices by an average of 1.4%.

Company officials said the price hikes were necessary to keep pace with inflation and to meet a growing desire by consumers for extras such as air bags and air conditioning.

News of higher prices at the car showroom came a day after the Big Three auto makers said sales of U.S.-built cars fell 8.8% in the last 10 days of July.

Analysts said the data shows that there is still a long way to go before U.S. auto companies return to profitability.

But the latest sales figures show a slow and steady climb from the anemic sales rates that sent first-quarter 1991 results at Ford, Chrysler and GM deep into the red.

The Big Three lost $2.33 billion in the period.

GM and Chrysler hope the price increases will help stem the red ink.

GM said the price hike would help cover more costly production. Costs incurred in complying with government regulations are also reflected in the price rise, it said.

In nine of the past 10 years, GM said its new-car introductory price rise has lagged the overall rate of inflation.

During the 1992 model year, GM said it will produce nine new passenger car models for the U.S. market. Four new passenger car engine models will become available in 1992.

In addition, GM said it will offer air bags, anti-lock brakes and traction control on more passenger car models in the 1992 model year.

Chrysler said it will continue to offer low-priced base model cars such as the Plymouth Sundance and Dodge Shadow America, both with air bags, for less than $8,000.

The company did not announce truck prices but said it will continue discount packages on minivans, pickups and Jeep vehicles.

Chrysler said the package discounts on 1992 models will reduce the manufacturer’s suggested retail price by as much as $1,200 on a Dodge Dynasty LE compared to what it would be without the package.