Sunday, May 07, 2006

The Impact of Gas Prices

One article in the NYTimes by Dan Gross and a number of Blog comments mention that high Gas Prices have not affected American Driving pattern very much, Most Commentaries attributing this fact to the actual percentage of Household Income which actually goes for the purchase of Gasoline. The Argument has a lot of holes within it.

There will always be slow change in behavior buying when the Product concerned equates to a Necessity purchase. We now live in a Society of Two or Three-Income Households. Every Income requires a vehicle in most instances, as the normal American Household has no access to Public Transportation. The current Household ownership of vehicle type is generally Gashogs. Vehicle Turnover is slow because of the high Price of Conversion. One must remember Household members must use these Vehicles daily for Job access.

The real impact on high Gas Prices will be found on the Dealer showroom floor, and in the traffic through Tourist facilities. There is another impact center which is the Ton-mile Costs in Transportation--which leads to higher Wholesale Costs. One cannot be fooled by Conservative Optimists' resort to simple Numbers alone. A resort to Numbers should instead ask What is the current Cost of a Two-Week, Four-Member Family Vacation by Car, considering the Cost of Gasoline and Motel Housing? There is the real Enemy of both the Family and the Tourist industry. lgl

1 comment:

Will said...

I enjoyed your post but respectfully disagree. First off, gas prices have been high for some time, but car buying patterns haven't shifted dramatically. There is no solid evidence that American driving habits have changed.

Gas is still cheap. For the families that purchase SUVs and other gas guzzlers, even a $1.00 a gallon price difference doesn't ammount to much of a cut out of their budget.

I posted a rant on this at www.utterhorror.com today, I'd love to hear your feedback.