Volume 13, Issue 45 ~ November 10 - November 16, 2005
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From the Editors of E/The Environmental Magazine

Rising Gas Prices Drive Smaller Guzzler Sales

Have high oil prices of late really caused Americans to buy fewer SUVs, or is this just a myth?

—Shane Wiener, Royal Oak, Michigan

It is indeed true that sales of sport utility vehicles — not to mention pickup trucks and vans — have plummeted in recent months in the U.S. Undoubtedly rising oil prices are playing a big role, and sales of the Ford Explorer, Lincoln Navigator, GMC Yukon and Hummer H2 are all down 50 percent or more.

But U.S. automakers point out that sales have been dropping across all product lines and that attractive financing programs last year translated into record sales. But General Motors, the world’s largest automaker, did report that overall sales in the U.S. sank in October 2005 by 22.7 percent compared to the previous year, while sales of SUVs, pickups and vans shrank by 30.3 percent. Ford Motor Company experienced similar drops.

“We realize that gas prices are important to consumers, and we’re certainly not denying that there’s an impact,” says GM’s Paul Ballew, who thinks the change in consumer preference is not as significant as it was following the world’s first round of oil shocks three decades ago. “We are seeing more interest in consumers understanding fuel economy of vehicles. But there’s not the shift we saw in the ’70s and ’80s.”

Against this backdrop of gloom for American automakers, Japanese competitors specializing in smaller cars have reported banner sales numbers in recent months. Toyota, maker of the industry-leading gas-electric hybrid Prius, beat its own October U.S. sales numbers from a year earlier by 5.2 percent. Honda, which offers the world’s most fuel-efficient traditional cars as well as hybrids, saw its U.S. sales rise four percent in October. Toyota’s SUV and pickup sales slackened by four percent, while Honda bucked the downward trend by staying even with last year with its light-truck line.

One sign of flagging consumer demand for large, gas-hogging SUVs is the recent development of so-called crossovers, which are SUV-type vehicles built on smaller, more fuel efficient frames. These vehicles, such as the Chrysler Pacifica and the Toyota Highlander, appeal to consumers looking for better gas mileage but unwilling to give up the SUV’s size. Today almost half of all light trucks sold are considered crossovers. Just two years ago, such vehicles accounted for only about 16 percent of the country’s light-truck fleet.

Another new option for light truck lovers looking to save gas and money is the hybrid SUV, which, like a hybrid car, utilizes both gasoline and electric engines to maximize fuel efficiency. Ford and Toyota lead the pack in hybrid SUV sales, but new models on the way from GM promise to provide consumers with even more ways to live large with less guilt.


For more information:

• U.S. Department of Energy: www.fueleconomy.gov

• Toyota Highlander: www.toyota.com/highlander

• Highlander Hybrid SUV: www.toyota.com/vehicles/minisite/hhybrid/index.html

• Chrysler Pacifica, www.chrysler.com/pacifica

• Ford Hybrid SUV: www.fordvehicles.com/escapehybrid/home

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