Just when you think the world is settling down, it goes crazy again.
All this and I haven’t even mentioned gas prices yet.
I’ve been getting used to prices at my neighborhood pump hovering around $3.15 per gallon. That’s not too bad, considering I can still fill up my little commuter Suzuki for less than $30. My wife’s SUV, though, demands well over $50 of unleaded fossil fuel. That hurts a bit more.
Now, thanks to the unstable situation developing in Libya, oil prices are soaring again, and an uncertain future for car sales lies just around the corner.
Gas that costs $4 (or above) would almost certainly derail the automotive recovery we’ve been reading about for the last couple months. I mean, let’s be honest, nothing can kill a car-buying buzz quite like expensive gasoline.
So the question will become: Have automakers done enough to weather a storm of freakishly expensive gas? With the introduction of cars like the Ford Fiesta, Chevy Cruze and Fiat 500, there are certainly more fuel-saving options than there were during the gas spikes of 2008. On the other hand, there’s a great article at AutoObserver that says high gas prices depress car sales no matter how efficient new cars are:
There’s a certain tipping point with gas prices where people will just stop buying big-ticket items. And at that point, it doesn’t matter what vehicles GM or Hyundai makes.
I see four possible outcomes if gas prices top four dollars and head toward five:
- Sales of new cars will plummet, because consumer confidence will be down.
- Sales of economical new cars such as hybrids, electrics and the Chevy Cruze diesel (available in 2013!) will skyrocket as people bite the bullet and invest in the future.
- Sales of used cars will increase as people look for inexpensive and efficient transportation.
- The federal government will implement a trillion-dollar program to offset the cost of fuel so Americans continue to buy F-150s and supercharged Camaros from U.S. automakers, thus ensuring their profitability.
Okay, so number 4 isn’t exactly likely, but I can’t say I’d be surprised.
Will you buy a new, efficient car when gas prices spike? You’ll probably find me on DealFinder looking to replace a certain SUV…