The news comes even as prices are finally starting to fall on some dealer contracts. The average cost of a new car fell in September for the first time in five months.
In its latest earnings report for the third quarter, Toyota revealed that US sales fell for both Toyota and Lexus. The company’s cars are still in high demand, but brands have been hit hard by supply chain challenges. Both have been among the lowest supplies in the industry over the past year.
Dealers lack cars for sale
Some of the company’s most popular models are not available.
Automakers measure their supply of new cars to sell in a measure they call “inventory days” — how long the cars would take to sell at today’s sales rate if they didn’t build more. Most of the industry traditionally aims to hold about six weeks of supply from popular models.
At the end of September, Toyota dealers had fewer than 10 days of Camry midsize sedans, Corolla compact sedans, Corolla Cross compact SUVs, Highlander midsize SUVs, RAV4 compact SUVs, Sequoia full-size SUVs, and Sienna The minivan.
Lexus dealers were in slightly better shape but still had a two-week supply or less of IS sedans, GX, LX and NX SUVs.
With fewer cars available for sale, the company needs to find a way to make more from each sale.
Prices may change often
Head of accounting department Masahiro Yamamoto told AN that Toyota traditionally raises prices “once or twice” annually. But he said the company was exploring the idea of ”increasing the frequency of price changes”.
Younger competitors like Tesla have pioneered the practice of changing prices more frequently — in the last year alone, Tesla has raised prices 10 times on some cars.
Worried about inconvenience to customers
Toyota faces a public relations challenge regarding the way customers expect to sell its most popular vehicles in a specific price range.
“We’d like to keep this overall picture of the vehicle and the price relationship,” Chief Communications Officer Jun Nagata told AN.
Toyota is the world’s largest automaker by volume, with its practices shaping the industry. If Toyota dealers start increasing their prices, the idea could spread through a lot of other sales.
We will report price changes as they occur.