Is $350 per Gallon the Tipping Point for Car Sales?

Alan Mulally blames gas prices for the instability in the U.S. vehicle market. Once consumers faced $3.50 per gallon gas, SUV and truck sales started to lose steam. Mulally doesn’t see the trend reversing in the near future, so Ford announced reduction in production for the rest of the year today.

I can’t say I’m surprised to hear Americans are starting to consider smaller vehicles, but I still don’t think trucks and SUVs will disappear so quickly. I think Americans like to complain about the price of fuel, but we’re slow to change our habits to reduce our fuel consumption. Sure, some people are shelling out far too much money to buy used Geo Metros, but I’m not ready to believe most people would go so far to reduce fuel consumption.

Will increased gas prices force you to drive a smaller vehicle, or will you just plan your trips better? Maybe you aren’t going to change anything. Let me know where the tipping point is for you in the comments.

Source: Automotive News


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