Automakers often boast about how new production techniques can significantly reduce their costs. However, it’s a curious paradox that despite these cost-saving innovations, the prices of new cars continue to rise. This paradox exists because the law of supply and demand exerts a far greater influence on Manufacturer’s Suggested Retail Prices (MSRPs) than relatively moderate cost fluctuations. It’s also why consumers should not anticipate a sudden surge in vehicle prices now that new UAW contracts are being ratified.

Negotiators with the UAW scored big wins for Ford, GM, and Stellantis workers in the U.S. Their pay is expected to rise by 11 percent immediately, and by 30 percent over the four-and-a-half-year lifespan of the contract.

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Will Record UAW Contracts Increase Car Prices?

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