Gas Prices affect SUV values.

Gas prices affect SUV values

"Gas prices have reached another record high in North Carolina.

The average price is now $2.34 a gallon.

“The days of cheap gas are over,†said Sarah Davis of AAA Carolinas.

So is it time to trade in that gas-guzzling, sport utility vehicle for a gas-electric hybrid like the Toyota Prius?"

"Buddy Flesch, a car salesman at Town and Country Ford in Charlotte, sees some people trading in their SUV for a hybrid -- but not as many as you might think.

He said that’s because of a Catch-22. Soaring fuel costs are hurting the resale value of the SUVs.

So are the new employee pricing plans.

"With the prices going down on the new, they're also going to down on the used,†Flesch said Friday."

Yep. Some people didn't think of that before they bought. I saw on the news today a guy buying a new GM truck for $9,000 off the sticker. I wonder how much gas that will buy him when it goes over $3 a gallon. And how much will his truck be worth when he's guzzled it all.

On a different note....I finally got my (retired engineer) Father to ride in my Prius. He had to. I took him to L.A. to see the Tut exhibit. He had no complaints, except that I got too close to the car in front when I braked during the stop and go traffic. I pointed out Arizona Charlie's parking guide and told him I had at least another two feet. He did compliment the smooth ride and that he had no idea I was going 75 mph. And later he said that in a few years everyone will be driving hybrids.

My Dad is a Cadillac man.

I imagine if GM made a hybrid Caddy he might consider trading his in. It has less than 50,000 miles on it but already needs new shocks and takes a lot of oil between changes. It's also 7 years old. They'll have to buy another car eventually.

My Mom likes the car but she wants luxury: leather, heated seats, lumbar adjustments and electronic adjustments in all directions.

My Dad just wants a bargain: He wants fuel economy, dependability, cheap to maintain, power up hills, good pickup from a stop, fast on the freeway, basically everything the Prius has now. Only it's not a Caddy.

But I wonder what a few years will bring. When they have to buy another car....this one will be worth very little due to age and (lack of) fuel economy. He'll never be able to trade it in. He'll have to sell it as private party and he will never get what he thinks it's worth. (see this article) But I think if there are a lot more hybrids out there, the prices are comparable, there's no waiting list, they make them more high end inside...I'll bet they might buy one. My Mom will do what my Dad wants. My Dad will buy what makes my Mom happy.

I'll just tell each of them it's what the other wants.

Too bad he'll miss the tax credit. He'd *really* like that. (Which means he'll buy a GM since they'll probably still be under their 60,000 allotment.)

But I really want them to have the HSD and variable automatic.

 

I think the record sales are ALL about the employee discounts.

I think once those discounts are gone their sales are going to tank.

And it won't take long for people to realize that they made a bad mistake. Their current car is worth a lot less if they ever decide to trade it in.

It will be interesting to see if the 'end' of the sale figures are less than at the beginning because in the mean time the price of gas went up. Of course some of these buyers don't care. They'll complain but they'll pay at the pump anyway.

I wonder what happens when everyone is over $3 a gallon. Then $4.

One article I read suggested we'd all lose weight because we'd cut down on food to buy gas. I can certainly see people not going to the movies, cooking at home instead of eating out. Buying less electronics and other consumer products. Which will all be more expensive of course, becaue the haulers are going to charge companies for the high price of diesel.

 

People are paying almost $3 a gallon and there hasn't been a drop in demand. People aren't buying less gas. They're paying.

Do you really think that gas prices will drop when they've proved they can sell it for what they're asking now and demand is constant or even increases?

They'll use the same strategy that Enron used. They'll make sure the supply is tight. Even if refineries have to be taken off line for "maintenance" or repair or because of a fire or for whatever.

Will the price fluctuate? Yes. Will it go under $2. I doubt it. It will go down and then up and then down and then up. But in the end, it will continue to inch higher.

Those new technologies to take advantage of previously unattainable oil are going to cost money. And despite that Energy Bill welfare program, the cost will still be passed on to the consumer.

The days of cheap gas are over.

The only way I see gas prices really going down is to remove the demand. An alternative fuel that is cheaper, leaving gas for the few things for whom this new energy source is impractical. I don't see that happening for 20-50 years.