Ford Motor Company has raised prices again this month, citing increased commodity costs as the cause for the third increase of the year in just 5 months.
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After raising prices in January and April, this latest price hike of 0.4% across the model lineup (an average price per vehicle of $124) brings the total price hikes for 2011 to 1.3% and $375. Ford representative Todd Nissen told Automotive News that the rising costs of raw materials is forcing the automaker to increase the prices across the entire Ford and Lincoln lineup. Nissen also stated that the average price increase through 2011 is 1% among major automakers, so Ford is right on par with their competition – along with being slightly higher.
In the past few months, both Toyota and GM have hiked prices for similar reasons. On top of the general price increase caused by increased commodity prices, the devastation to the Japanese auto industry has caused shortages in a variety of segments and with shortages – you have price increases through the laws of supply and demand.
Even though Ford has gradually increased prices over the course of 2011 at a rate higher than the rest of the industry, their sales have remained very strong with a 12% improvement over the first portion of the 2010 calendar year. Even with these price increases, Ford’s success has been due in large to the popularity of their fuel efficient, smaller models as gas prices tickle the $4/gallon mark. The popularity of small, efficient compacts is likely to continue, helping Ford’s growth in the market but their own advances in fuel economy have allowed them to offer some of the most fuel efficient trucks and SUVs in the US auto segment.
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Ford continues to grow while Lincoln struggles in April 2011
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The fact that Ford's cars
The fact that Ford's cars continues to sell like hot cakes despite the slight increase in price shows that consumers are willing to pay for the Ford brand. Cars that are good on gas are where it's at these days.