Small cars find demand and prices rising

DETROIT, Sept. 3 (UPI) -- U.S. consumers may be surprised to find the prices of smaller cars rising as automakers attempt to find profits in a changing marketplace, analysts said.

The turn from truck and SUV sales to smaller models means a deep cut in profit margins for automakers, Aaron Bragman an industry analyst at Global Insight told USA Today.

Bragman said the profit on a large SUV was typically $10,000 compared with about $100 in profits from the sale of an Ford Focus.

Demand is likely to push the price of small cars but automakers are also adding features to increase profit margins, the newspaper reported.

Ford, Honda, and General Motors are adding premium features, such as leather seats and navigation systems, to small cars, in an attempt to increase profit margins.

Automakers "simply have to get (small cars) more expensive. They're losing their revenue stream and profits from big trucks," Bragman told USA Today.