Kelley Blue Book Poll Shows Buyers
Opting for Smaller Vehicles as Gas Prices Rise
The latest AutoVIBES poll from Harris Interactive and Kelley Blue Book Market
Research reveals that if gas prices reach more than $3 a gallon, as predicted by
many energy analysts, in-market vehicle buyers' purchase decisions will be
profoundly affected.
According to the poll, 47 percent of U.S. adult consumers in the market to buy a
vehicle in the next several months have already changed their minds to buy a
more fuel-efficient vehicle or will consider vehicles they would not normally
look at due to the increase in gas prices. An additional 30 percent say that
they will seriously consider a more fuel-efficient vehicle if gas prices rise by
75 cents, bringing the total percentage of those likely to be affected to 77
percent.
Two of the chief manufacturers of large SUVs--Ford and General Motors--saw a
sales decline in that segment as gas prices rose in March. If gas prices do
reach the $3-a-gallon level, the figure (when inflation-adjusted) will tie the
highest gas price of all time reached in 1981.
"Up to now we've seen buyers shifting from large SUVs to small or mid-sized
SUVs as fuel prices have risen," said Jack R. Nerad, editorial director,
Kelley Blue Book's kbb.com, "but that could change dramatically if gasoline
prices cross consumer pain thresholds. A $50 or $75 fill-up could push consumers
toward hybrid vehicles and smaller, more fuel-efficient vehicles. This, of
course, has serious implications for American manufacturers who have staked so
much on the large SUV segment."
The March AutoVIBES report also showed that consumers' consideration of hybrid
vehicles like the Toyota Prius or the Ford Escape Hybrid doubled from the
previous month. In February, only 4 percent of vehicle shoppers said they were
interested in buying a gas/electric hybrid vehicle. In March, that figure jumped
to 8 percent. While that number is still small in relation to the number of
vehicles sold overall, it can be viewed as a significant increase, according to
Scott Upham, senior vice president of automotive research, Harris Interactive.
One fuel-efficient alternative to the gas/electric hybrid engine is the
new-technology diesel engine. Today's diesel vehicles like the Mercedes E320 and
the Jeep Liberty are delivering between 30-40 miles per gallon, which puts the
new diesel technology nearly on par with the mileage of many of today's hybrid
vehicles. However, according to the March AutoVIBES report, in-market vehicle
shoppers' likelihood of purchasing a vehicle with a diesel engine declined over
the last year.
"The interest in hybrid technology over the newer diesel technology is a
result of smart marketing and promotion by those few companies that currently
sell hybrids," Nerad said. "Toyota has done an unbelievable job
marketing the Prius, Honda is gaining great press from its Civic and Accord
hybrids, and now Ford is doing the same with its Escape hybrid. Diesel
technology, on the other hand, hasn't been promoted as well and doesn't seem
nearly as sexy as hybrids."
Published 04/14/2005
©
2005 Greenmedia Publishing Ltd.