Petrol prices in the US soared to a record $US2.55 per gallon nationwide last week and some areas already are seeing prices at or above $3 a gallon but automakers and industry watchers say the price spike isn’t yet affecting consumers’ car buying habits, according to an Associated Press (AP) report.
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Chrysler spokesman Kevin McCormick told the news agency the company isn’t seeing a slowdown in any segment, including its popular pickup trucks. Toyota also reportedly said petrol prices don’t seem to be affecting sales.
According to AP, Ford’s US sales analysis manager George Pipas predicted that August would be a strong month for the industry, although not as strong as June and July but said it was too early to conclude that a slowdown in August is due to high petrol prices.
Instead, the report said, many people bought vehicles earlier this summer, when the Big Three introduced discount programmes that let customers buy 2005 vehicles at the employee price – Ford and GM plan to end those discounts on September 6 but Chrysler is continuing its discount indefinitely.
“We had this tidal surge in July,” Pipas told the Associated Press. “That’s not going to be duplicated in August.”
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By GlobalDataAn Ohio GM truck dealer, Ed Babcock, told the news agency that his sales will probably be down in August, but he doesn’t blame petrol prices.
“In the past when gas prices have gone up, we’ve not seen the change in sales,” Babcock reportedly said. “If I had them, I think I could sell them.”
Pipas told AP that petrol prices will affect the market by accelerating a trend toward crossovers and smaller vehicles that automakers have been seeing for several years. Ford has introduced a crossover and several hybrid vehicles to meet that demand, but won’t bring new products out any faster because of petrol prices.
“You can’t really tinker with your product cycle plan as a response to higher gas prices, because we’re talking about lead times that are two or three years in advance,” Pipas told the news agency.
Toyota spokesman John McCandless told AP the company also won’t speed up any of its product launches because of petrol prices. Toyota plans to introduce a hybrid version of its Camry sedan in late 2006, he said.
Tom Libby, senior director of industry analysis for the Power Information Network, told the Associated Press that there’s no need for automakers to panic just yet. Customers’ car-buying habits likely won’t change as long as petrol prices stay lower than $4 a gallon and people believe the spike is only temporary, he said. But if prices go over $4 a gallon for more than a year, all bets are off.
According to the Associated Press, some US dealers say they’re already seeing changes in customer behavior because of petrol prices.
Peter Welch, president of the 1,400-member California Motor Car Dealers Association, told AP that many families in the state still have a minivan or an SUV in the garage but are buying a smaller, more fuel-efficient car for quick errands or commutes.
He expects that number to grow once hybrid vehicle drivers are allowed to use California’s car-pool lanes in a few weeks, AP noted.
