Toyota to Raise U.S. Prices 1.8%

Toyota Motor Co., pressured by the continued appreciation of the Japanese yen against the U.S. dollar, will raise prices on vehicles sold in the United States an average of 1.8%, or $297, next month.

Meanwhile, Toyota’s Lexus luxury division said in a separate announcement that it too is boosting U.S. prices on its 1994 models, by an average of 2.4%, or $921.

Both price increases take effect Jan. 3.

“We’re still getting hammered by it,” Toyota spokesman John Hanson said of the yen, which so far this year is up 11% in value against the U.S. dollar. A stronger yen makes it less profitable for Japanese companies to sell their products in the States.

“Detroit is eating the Japanese for lunch,” S.G. Warburg analyst David Healy said. He estimated that Japan’s total share of the U.S. market, including U.S.-made models, will slip a full point to 22.9% this year, down from 25.4% in 1991. Japanese imports alone will fall to 11.5%, the lowest level in eight years, he said.

Today’s increases come after Toyota announced price hikes in September averaging 6.2%, or $945, on its U.S. cars and trucks. While much of the increase was because of the stronger yen, new standard equipment, such as dual front air bags, also accounted for the increases, the auto maker said.

Japanese auto makers have raised prices more than 11% in the last year, mostly because of the higher yen.