Sunday, October 26, 2008
Lower cost of gas = less small car demand?
Gas is down to levels not seen in over a year. The national average is now $2.65 a gallon--this is all good on the pocketbook.
Now that gas has come down quite a bit, I suppose it's possible that the small-car boom might plateau or even fall. Then again, with less money flowing around in people's pocket books, small, fuel-efficient might make more sense.
However, we saw this happen in the 1970s and 1980s, too. Smaller, fuel-friendly cars started appearing in droves due to the gas crisis. Eventually, people started buying the big vehicles again, and not worrying about fuel economy nearly as much, making small car options very narrow.
Could it happen again, or are subcompacts here to stay?