Toyota hikes car prices for first time in 30 years

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TOKYO, August 25, 2008 (AFP) - Toyota Motor Corp.
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said Monday that it will raise the prices of some passenger cars in Japan for the first time in three decades in response to skyrocketing steel costs.

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The move is expected to cushion the automaker's profits from the impact of higher material costs, but it risks depressing already weak demand as the Japanese economy teeters on the cusp of recession, analysts said.

Japan's largest automaker said it would increase the retail price of its popular Prius hybrid by three percent from September 1.
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The prices of commercial vehicles will rise by 2.0 percent on average.

Toyota, vying with General Motors to be the world's top automaker, said that so far it had been able to compensate for material prices by cutting costs.
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"However, recent further price increases in raw materials have been larger than Toyota's cost reduction efforts are able to offset," it said in a statement.

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Japan's auto market is in a slump, depressed by weak consumer spending, a shrinking population and signs that younger Japanese are lo

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