Remember when we told you that GM plans to make more money off of its small cars by upping its prices? Well, as far as the Cruze is concerned, not only do they plan to charging substantially more than the outgoing Cobalt, they might demand more cash than a comparably equipped Corolla, Civic, or Focus. According to GM, that's because it needs to make more per car than Honda or Toyota. With the average Civic rolling away for $19,184, GM doesn't have a lot of room to play before hitting the $20,000 ceiling. And if GM was to get an average price of $19,500 for the Cruze, that would be a $3,000 premium over the current (average) price for the Cobalt. That still gives no indication of how much money GM would actually be making on the car, though. Design honcho Ed Welburn feels the car's styling and interior will justify the extra dosh, and said he believes "we have some very unique content and materials that are in the vehicle." Conviction is a good start, and if they can back it up the verdict might go their way. For that, we have to wait for the jury of consumers to decide.
The skyrocketing cost of commodities like steel and aluminum have pushed several automakers to raise the price of 2009 models. Hyundai is bumping the price of its 2009 models an average of two-percent to help cushion the blow in Korea and in the States. The price of steel has risen 60 percent in a little over a year, and other commodities are up over 20 percent as well. That's bad news for all automakers, and Hyundai expects the trend to continue. Hyundai's Kia brand stlil hasn't announce price hikes, but we're guessing the economical car maker will follow in big brother's foot steps.
To further complicate matters for the Korean automaker, its unionized workforce is unsatisfied with wages. The rank and file have scheduled four-hour work stoppages for Wednesday and Friday. Unless the government intervenes in the matter, the union will likely get some kind of wage increase, giving Hyundai and Kia yet another justification for raising prices.
In the past few years, we've all heard about the price of cars and trucks being impacted by the price of steel. We've also heard about the reduction in the numbers of trucks sold due to the downturn of the housing market. According to this article (sub. req'd), there is a new raw material affecting the price of vehicles: sawdust. It seems that the slow housing market means that fewer scraps of wood are being reduced down to dust, which is used in the manufacture of certain interior components, like steering wheels. Apparently, there are a few substitutes to sawdust in the farming industry, like cow manure. This fact raises an interesting question: would you rather pay more for your car or have the steering wheel made with cow manure? Or, how would the use of cow manure in the making of your next car affect that "new car smell" that we all know and love?
