Nissan Motor Co. is planning to raise its vehicle prices in Japan in a bid to pass along higher raw-material costs, according to a Japanese media report.

The Japanese carmaker said the continued price hikes will affect the business and is likely to erode the bottom line of Japan's third-largest automaker by $1.62 billion this fiscal year, the Nikkei newspaper reported Thursday, citing comments by Nissan's President Carlos Ghosn in an interview.

Nissan said the move is needed in order to help offset higher material costs which are expected.

The company did not offer details of the size of the price hikes, but has already lifted prices on a range of models sold in the U.S. by $170 to $480 in recent months.

Nissan will also employ a cost-cutting program to help offset the effects of higher material prices. The effect of higher prices upon demand will be widely watched by Japanese automakers.