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4:33 am - Tuesday November 12, 2019

Gas Prices Finally Impact US Car Sales

| Economics, Money Saving Tips | Rating: 4.5
by Numan

More on the better side of record gas prices

For some reason pickup trucks and SUVs have rooted themselves in American culture. Apparently they serve as symbols for strength, power, durability and more values that are held dear to many Americans.

I’ve read somewhere the pickup serves as the modern horse, keeping the old west’s heritage alive. With all due respect to culture it seems more and more Americans are finding it hard to continue maintaining these gas eating monsters with gas prices constantly rising.

Americans save on gas by switching to economy cars

According to Reuters US auto sales tumbled in many as consumers spurned pickup trucks and SUVs in the face of record gasoline prices, driving General Motors Corp (GM.N), Ford Motor Co (F.N) and Chrysler LLC to double-digit declines.

Furthermore, Japan’s Honda Motor outsold Chrysler for the first time to emerge as the new No. 4 U.S auto-maker with Toyota closing the gap on General Motors.

Record gas prices apparently sent Ford’s sales tumbling down by 16% and General Motor’s sales by 28%. Honda, on the other hand, registered a 16% in Civic model sales which are fuel economic. Pickup truck sales were reduced by 30%.

Could it be Americans are realizing how wasteful and costly these vehicles are?

The smell of change is in the air but history teaches us we humans quickly adapt for better or worse. In the 70’s the oil crises caused gas prices to soar forcing Americans to seek cheaper more economic alternatives. This was the growth bed for the Japanese auto industry in the US.

Now, as then, it’s money and economic considerations which make the biggest difference (rather than ideology, environmentalism and more). As long as gas prices remain at all time highs this trend will continue.

However, should prices drop or remain stable I believe the public will quickly get accustomed to paying more on gas slowly turning the trend back around.

Americans driving at historical lows

In the meantime we get to experience the better side of high gas prices. A press release by FHWA reports Americans drove less in March, 2008 continuing the trend from November 2007.

Additionally, the U.S. Department of Transportation estimated that greenhouse gas emissions fell by an estimated 9 million metric tons for the first quarter of 2008.

Record gas prices take their toll on countries and people all around the world

In India three county states went on strike a response for high gas prices. Malaysia suffered mass demonstrations after the government announced a 41% increase in gas price while in France and Spain taxi drivers blocked highways and roads to protest against record prices.

Governments seemingly have their hands tied having little other choice than to constantly adjust prices. But that is only half a truth. These countries can and need to make strategic decisions regarding their dependence on oil as an energy source.

New Zealand recently announced its strategy of becoming the first sustainable nation in the world and will balance its gas emissions. Furthermore, currently 70% of New Zealand’s energy is generated from renewable sources and it has committed to a goal of 95% by the year 2025. That’s strategy and definitely a lesson to be learned by leaders everywhere.

Hopefully the environmentalist trend is here to stay even when gas prices cool down a bit.

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