GM’s Price Increase Smallest in 11 Years

Suggested prices of General Motors Corp.’s 1998 cars and trucks will increase an average of 1.3%--the auto maker’s smallest fall increase in at least 11 years--the company said Thursday.

GM said its car prices will increase an average of 1.5% and that truck prices will rise a modest 1.1%. The increases are over year-end prices for 1997 models.

Compared with introductory 1997 model prices, GM’s increase for 1998 models will average 1.48%, the company said.

Ford Motor Co. and Chrysler Corp. plan to announce their ’98 prices in August. They also are expected to keep increases to a minimum.

The Big Three are facing increased pressure from Japanese auto makers, who have cut sticker prices on some high-volume models and increased their share of the U.S. market. Detroit has responded by lowering prices on many ’97 models with rebates and discount financing.

Toyota last year cut the price on its redesigned 1997 Camry. The sedan is well on its way to ousting the Ford Taurus as the top-selling car in the United States this year.

And last week Nissan said the price for the best-selling version of its Altima sedan would be $1,500 less in ’98 than the comparably equipped ’97 model.

Vehicle prices are leveling off after four years of growth; the average price of a new vehicle now exceeds $20,000. The increases have been spurred in part by consumer demand for more standard equipment and the popularity of higher-end pickups, minivans and sport-utility vehicles.

GM’s 1.3% increase reflects only the 42 models being carried over from the 1997 model year, not all-new or substantially redesigned models. Prices for the new Oldsmobile Intrigue, Chevrolet Prizm, Chevrolet Corvette convertible and Cadillac Seville will be announced closer to their introduction, spokesman Dean Rotondo said.

GM said the largest increases will be on newer models that are selling well, such as the Chevrolet Cavalier coupe and Venture minivan. Prices for both will rise at least 2% on popularly equipped versions.

“We found we could take a little more price because the market’s really demanding that,” Rotondo said.

Only prices for the Chevrolet Corvette and imported Cadillac Catera will remain unchanged.

GM’s shipping charges, which vary by model, also will not change.

Rotondo said GM’s ’98 models will be priced below comparable models sold by its competition, even if there are further price cuts on some Japanese models.

GM shares fell 62.5 cents to close at $55.375 on the New York Stock Exchange.