Considering all of the press that has been inked (or typed) regarding both John McCain's and Barrack Obama's various plans for the ailing automotive industry in America, you may think that the two hopeful presidential candidates would be in tune with the plight of the average driver who fills his or her tank. Or not. It seems that Republican John McCain is not aware of how much a gallon of gas costs. In fact, he says, "I don't recall, and frankly, I don't see how it matters." We have no intention of pushing any sort of political agenda, and this writer in particular is not attempting to back either politician with this writing, but the question begs to be asked: how in the world could somebody living in the United States not know how much gas costs today? Every time the news is turned on or the internet is fired up, citizens are bombarded with constant reminders that gas has crested the $4 a gallon mark. It must take a really busy man to be completely unaware of the price of gasoline these days.

Update: McCain apparently knew the price of gas when he gave a speech on June 18. See here.

[Source: Auto Observer]

Photo by Cyfer13. Licensed under Creative Commons license 2.0.

Before gas prices began soaring skyward, it had often been suggested that an artificial increase to the price of gas could have the effect of forcing consumers to purchase more fuel efficient vehicles and could keep people from making frivolous trips. It's now safe to say those projections were likely true. Now that fuel prices are what they are, more people are choosing hybrids and other fuel efficient models, and some are even choosing two wheels over four. Additionally, Jeff Rubin, chief economist at CIBC World Markets, projects that $7.00 per gallon of gas could potentially remove ten-million vehicles from roadways in the United States alone. What's more, Rubin predicts that by 2012, the average miles driven will drop by as much as fifteen-percent.

Interestingly, Rubin compares U.S. driving habits with those of individuals living in Britain. Statistics show that ninety-percent of American drivers commute every day to work in an automobile, while only sixty-percent of British workers do the same. Fuel prices in America, though rising, have yet to match those that many European countries have seen for years.

[Source: The Detroit Free Press]

Here in the United States, consumers who fill up their fuel tanks are just now beginning to see the type of pain that Europeans have seen at the pump for years. Reactions to the recent rises in gasoline and diesel fuel are pretty much what you would expect, with new car purchasers eschewing gas guzzlers for more fuel efficient models left and right. Even manufacturers have gotten into the game, offering low cost fuel for up to three years in Chrysler's case, or giving gasoline away for free for a few months, as Suzuki has done.

These same manufacturers, though, are not planning on such tactics in Europe, where the trend has been towards smaller, more fuel efficient vehicles for a long time now. Only Kia is considering fuel incentives at all, according to Auto Express. Even here in the states, the cheap gas ploy has seen decidedly underwhelming response, so we don't expect to see many manufacturers opt for this type of incentive much in the future. Just building more fuel efficient cars in the first place seems to make much sense, wouldn't you say?

[Source: Auto Express]

Apparently, China hasn't learned from the policies of the United States when it comes to petroleum prices. For decades, the price of gasoline has not reflected its true cost because prices have not factored in the cost of military expenditures required to maintain "friendly" governments in countries that supply large amounts of our oil. As a result Americans have long favored larger, more powerful vehicles - and they could afford them because gasoline was cheap and plentiful. China has gone from being a net exporter of oil to the world's largest consumer since 1994. China now imports half its oil needs and subsidizes the retail price to less than $3/gallon.

As a result Chinese drivers with increasing disposable incomes are opting for bigger, more powerful and thirstier vehicles, just like Americans. SUV sales jumped 38 percent and luxury car sales jumped 30 percent in the first two months of this year, bucking the trend in the U.S. Those segments are outpacing the overall sales increase of 16 percent in the fast growing market. Just as in the U.S., the Chinese government is pushing automakers to build more efficient vehicles but so far consumers aren't buying. It seems that just as in the U.S. and elsewhere only higher fuel prices will prompt drivers to go for more efficient vehicles. The Chinese government is certainly in a better position to determine what fuel prices will be than in other countries and with a market that is still evolving they could make a push for alternatives like battery and fuel cell electric vehicles. Given the pollution that plagues cities like Beijing and the increasing dependence on imported oil, they need to do something.

[Source: New York Times]

How are gas prices affecting you personally? If you drive an SUV every day, your fuel bill is surely putting a crimp in your pocketbook. Even if you drive a vehicle which gets high fuel mileage, we imagine that you're still quite cognizant of your driving habits. Do you carpool to work or when dropping your kids off at school? Do you walk or ride your bike to places that you used to drive to? These questions are important, both to your fellow readers and to car manufacturers. To prove that point, Jon F. Thompson from Toyota's Corporate Communications has posted a new entry on Toyota's Open Road Blog, asking readers to comment on what changes they've personally made, if any.

Perusing the comments, it's easy to see that fuel prices are causing drivers, no matter how efficient their vehicle is, to change their habits. If you've ever wanted to talk to somebody at a major car company about its fuel efficient options, here's your chance to do it.

[Source: Toyota Open Road Blog]

Not but two weeks ago, national gas price averages got to the $3 a gallon level, and the question was whether the summer gas peak had happened early or if we were looking at a record-high season for gas prices. Guess which one we can now confirm? If we take a look at the Energy Information Administration's gas price averages going back to 1983, it's clear that this week we're seeing the highest prices on record. Ever. Their average is $3.143 a gallon. The last time prices were close to that level was $3.117 back in September 2005 (right after Hurricane Katrina). The EIA creates their average using all grades of fuel. AAA's current average for regular-grade fuel is $3.103. So, how are we driving smarter now?

Related:

• Are gas prices peaking? I doubt it!
• Think $3 a gallon is bad? $3.50 is coming soon, say 72 percent of Americans
• Hey there $3/gallon gas! Long time no see. How've ya been?

[Source: Energy Information Administration via Autoblog]

I'm sure some of our European readers simmer with envy that gas is so cheap (comparatively) in America, but for many Americans the current prices look quite pricey. According to AAA, gas prices are about as high today as they've been in the last twelve months, which doesn't really bode well for the upcoming summer months, historically a time of higher gas prices. I wonder how people who still drive gas guzzlers are feeling about another summer of $50+ fill ups.

The national average for gas prices in America today was $2.977, more than a penny higher than yesterday. A year ago we were looking at $2.92, and the highest price in the last twelve months was $3.03. And, based on the trend we see in the graph, we can expect average gas prices to rise by about 9-10 more cents in the next month or so. Who's up for a bike ride?

[Source: AAA]

On NPR's All Thing's Considered this afternoon, one of the pieces was on the increasing gas prices, and how the upward trend is happening about three weeks earlier than is common for the summer spike. This article, from the San Francisco Gate/AP, says since crude oil is back up to over $60 a barrel, gas prices, particularly in California and Hawaii, are starting to top $3-a-gallon, and the AP found drivers across the country who are taking the bus or thinking about starting to research hybrid vehicles (to you, we extend a warm welcome on AutoblogGreen).

This is how Tom Kloza, chief oil analyst for the Oil Price Information Service, colorfully described the upcoming gas price situation to the AP: "The West Coast will certainly be the wild, wild West this year," and "In the rest of the country it's just petro-noia. They're worried that they won't have enough gasoline. But on the West Coast the concern might be warranted."

The AP writers spoke to other analysts who also said that $3 gas will come to the rest of the country later in the summer. What's it like in your part of the world?

[Source: AP]

Bloomberg News today is reporting that Toyota does not have enough gas-electric hybrid Prius vehicles to meet consumer demand, which must be nice for the company but means a long wait for customers and, for all of us, more carbon dioxide in the air. A Toyota vice-president told Bloomberg that the company could sell 250,000 of the vehicles this year, if they had them in the lots. The company sold about 108,000 last year and sales in April were down about 4,000 units from last year.
An analyst told Bloomberg that what used to be seasonal price spikes are becoming just regular old price spikes and that higher gas prices are driving demand for hybrids. Oh really.

[Source: Mercury News via Mixed Power]