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ReprintsHyundai to raise car prices; union to strike
July 15, 2008 - 7:46 am ET
SEOUL (Reuters) -- Hyundai, South Korea's top automaker, said on Tuesday it is raising car prices by about 2 percent to cope with rising prices of steel and other raw materials. Hyundai, the world's No.5 auto maker along with its affiliate Kia, said it would increase all car prices for the local market by an average 1.9 percent and lift prices for overseas markets by an average 2.0 percent from next month. "With weak car markets in the second half, the price hike is feared to dampen the markets further. But it is difficult to endure the situation without price raises," Hyundai said in a statement. Steel plate prices have jumped some 60 percent since the start of the year and other costs have gained about 20 percent, the company said, adding that raw material prices were expected to increase further. The price increases come as unionized workers at Hyundai decided to launch partial strikes on Wednesday and on Friday over a wage deal. Unionized employees plan to stop work for four hours on both day and night shifts on Wednesday and for six hours on the two shifts on Friday, respectively, a union spokesman Chang Kyu-ho said. Hyundai raised prices for some export models, including the Elantra sedan, earlier this month. Its affiliate Kia is considering a price increase but South Korea's No.2 automaker has not decided anything yet, a Hyundai Motor Group official said. Shares in Hyundai ended down 4.3 percent, under performing a 3.2 percent drop in the wider market, while Kia closed down 6.7 percent. |
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