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.