Blue Bird Corporation (NASDAQ: BLBD) is raising prices on school buses to offset rising material, freight, and labor costs primarily driven by the COVID-19 pandemic.
The company announced a new 4% increase that will affect all net selling prices for Type C and D model activity and school buses that are ordered on or after March 1. That comes after an 11% hike was announced late last year during a fourth-quarter investor call.
“As we enter 2022, the school bus industry continues to face challenging and unprecedented times,” said Matthew Stevenson, president and CEO of Blue Bird, in a news release. “According to a recent Labor Department report, inflation grew by 7% in 2021, the fastest 12-month increase in nearly 40 years. We continue to work with our supplier partners to limit the negative impact, but felt it was necessary to make this adjustment to our bus pricing. In addition, we have discussed the challenging business environment with our Dealer Advisory Council. We will continue to be transparent with all of our loyal Blue Bird customers and remain committed to building best-in-class school buses.”
The price increase also follows reports that, due to supply chain issues, Blue Bird and other manufacturers expect lead times of six to eight months for production of new vehicles.