Toyota to increase steel price for suppliers by 12%

Article by Anita Panait, on August 26, 2013

Toyota Motor Corp. will hike the price of hot-rolled steel it sells to suppliers by 12 percent in the second half of the current fiscal year by JPY8,000 ($81) a ton to JPY74,500 ($757), three people privy with the matter told Bloomberg. Toyota has notified suppliers of the plan. Toyota purchases steel in bulk and resells it to its network of auto parts makers for production use with a partial aim to help them cut costs and reduce the risk of currency swings, according to researcher IHS Automotive.

Toyota’s move is expected to raise a benchmark used in Japan’s auto industry, since smaller steelmakers in the country typically use the carmaker’s steel price to suppliers as a reference for their transactions, according to Takeshi Irisawa, an analyst at Tachibana Securities Co.

The price increase shows that Japanese carmakers and their suppliers are sharing some of their gains from a weaker yen resulting from the so-called Abenomics. On the other hand, steel producers are struggling with higher import costs for raw materials.

Nippon Steel & Sumitomo Metal Corp. inked a deal with Toyota in July to raise increase steel prices by JPY10,000 per ton for the first half of the year ending March 2014, the Nikkei reported last month.

That marked the first increase in steel prices in two years. Toyota’s suppliers purchased steel from the carmaker at a discount in the past two years. According to Bloomberg’s sources, Toyota offered a discount of JPY8,000 in the first half of the fiscal year compared with the second half of the previous fiscal year. [source: automotive news - sub. required]

Topics: toyota

If you liked the article, share on:

Comments

Login or Create new account to add a comment!

Recommended

Carmakers usually leave us thirsty for information on whether they would introduce a new, refreshed or face-lifted vehicle and on when they intend to launch it. There are reasons for...
by - February 20, 2017
Cadillac’s CT6 full-size prestige-luxury sedan is still somewhat new. It has been offered to the global auto market for two model years – 2016 and 2017. But for those who...
by - February 19, 2017
In many industries, it is the rivalries that make things exciting. In basketball for example, there is the well-known rivalry between the Los Angeles Lakers against the Boston Celtics. For...
by - February 19, 2017
Now on sale in several major markets around the world including Europe, the BMW 5 Series (G30) heralds the arrival of the new seventh generation and represents a whole new...
by - February 19, 2017
Just recently, it was speculated that a new Porsche Cayman GT4 RS is coming. There is no official confirmation yet from the German sports car maker, but the arrival of...
by - February 18, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries