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Fuel Prices Don’t Drive Sales of Alternative Fuel Vehicles, Study Suggests

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Fuel Prices Miami International Airport April, 2011
Fuel Prices Miami International Airport April, 2011

When we first became a fuel-conscious nation, back in the days of the OPEC Oil Embargo, we suddenly understood the merits of vehicles with better fuel economy. Small Japanese vehicles in the early 1970s just hadn’t made it into the public consciousness yet, but by the mid-1970s and later, small import and domestic vehicles were booming. Ever since, the price of fuel has had a more or less direct effect on sales of fuel-efficient vehicles.

Rising fuel prices typically mean a general rising of the overall fuel economy of vehicles that are sold. When fuel prices drop, drivers relax and consider vehicles that aren’t as economical. With the advent of alternative fuel vehicles, that is, hybrid electric and electric vehicles, as well as flex-fuel, biodiesel, one would make the assumption that these vehicles would see an increase in sales even more so than their pure gasoline counterparts, when the price of fuel starts increasing.

According to a recent study, though, it doesn’t seem that alternative fuel vehicles are enough in our minds to consider them when fuel prices increase. According to a report by Experian Automotive in Schaumberg, IL, when the fuel prices rise, sales of fuel-efficient conventionally-powered vehicles increase more than alternative fuel vehicles.

The study, based on the average month of sales of a million vehicles, suggests that if the price of fuel rises by $1/gal, the small-car segment might increase 0.7% or 7,000 vehicles. Alternative fuel vehicles, such as hybrid electric vehicles, wouldn’t fare as well, realizing 0.2% increase in sales, and pure electric vehicles would only see a 0.1% increase, less than 1,000 cars.

Perhaps one reason that small cars would benefit most from the spike in fuel prices is the simple fact that they cost less than their alternative fuel vehicle counterparts. Clearly, we have much work to do to help people understand the benefits of alternative fuel technology and overall cost savings.

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3 COMMENTS

  1. The fundamental problem is that what ever type of fuel we use, greenhouse gases will always be prevelent.  The only thing we can do is tp try and minimise or delay the ultimate consequences.  I see that just recently certain car manufacturers are considering solar and kinetic energy, but the reality is that until EV’s are a practical option and hybrids become affordable for all, we are going to continue to use our gas-guzzler’s regardless of what we are doing to the climate.

  2. Truth of the matter is big oil controls the alternative fuel industry. When prices go up on oil people start thinking about alternatives, not buying an electric car but perhaps investing in a company that makes one because they can see the potential. Solar stocks, wind stocks, etc, etc, rise when oil prices go up and when the oil company has made their play on these stocks the price of oil goes down and people move away from alternative fuel stocks. People do not become fuel conscious unless they feel the pinch at the pump. The mother of invention is need and no amount of hype or manipulation can change that. That’s why they came up with climate change. There is no real reason to move away from fossil fuels so we manufactured one. Don’t get me wrong it’s a wonderful plan, you find a natural process and claim that you are corrupting it in some way. The trick is it’s all true but only on the surface. The climate has been changing since it began. Climate change is real but that’s not the real question. The real question is can we control climate change by what we are doing or not doing? In the larger picture the answer is no. There are to many factors in play for any one part that you might be able to influence to change the picture as a whole. Lets face it you just don’t have enough influence to make a difference. I’m not saying we shouldn’t be better stewards of our planet because we should. However scare tactics and the sky is falling is getting a little old. I think I heard that when Mt. Saint Helens erupted it released more greenhouse gases in one eruption than all of mankind had in it’s existence. So how ya going to stop that? Oh and there have been lots of other eruptions since.

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