On occassion, I’ll use the Question of the Day feature as a tool to draw on the collective knowledge of the B&B to learn something; today I’m asking your your input on Tropical Storm (Hurricane?) Isaac.
Tag: Gas Prices
I realize opinions are like…elbows. But right now I am looking for a hit to the ribs.
I am moving to Northern California, and intend to live up in the hills around Skyline Blvd. / Highway 280.
I am debt free on a 2006 Mitsubishi Montero Limited. It is such a fantastic sleeper of an SUV; as rugged as I need for weekend camping, rock climbing and/or surfing excursions, and also cleans up well for mid-week business meetings (I work from home, so only need to drive to the office or customer site a couple days per week).
The Monty is in great condition, with 75K miles on the odometer, and still worth approx. $15-20K. It is safe for my wife, infant, and possibly future brood. The Monty is a gorgeous ”carbon grey metallic” color, without the cheesy spoiler option. It’s a stellar SUV in the classic sense.
That stated, I have the itch to sell the Monty and use that cash to buy a slightly ”lesser” vehicle (in terms of value), as well as an enduro-type motorcycle; perhaps a used BMW F 800 GS. (Read More…)
Last week in a speech at Daimler owned Freightliner truck plant, President Obama said that the new 55mpg CAFE standards will save a typical American family $8,000 a year on gasoline. That would be great news to most American drivers if it were true but the president took political science and law courses in college, not math. Or maybe his math isn’t off. (Read More…)
Pop quiz; what do increased production, lots of cash on the hood and high gas prices mean for Honda dealers? Lots of Civics moving out the door.
And this is only the start…
I’m currently in the market for a 2005 or 2006 Chevy Tahoe Z71 and was wondering about when would be the best time to buy. Before you question the Tahoe, I’m probably one of the only people who can justify one. I live in Colorado and spend almost every weekend in the mountains hauling people and their gear up 4wd trails and snowy roads to trail heads and sleeping in the back.
I figure that given gas prices going up, this summer would probably see the values drop off. I like to do the opposite of everyone else who will be buying fuel efficient vehicles. But then I read an article by Steve that said the used car market is going to be getting worse. I’ve see prices go down some over the last 6 months (been watching the market), but not by much. So does this summer sound good, should I buy now, or wait for the future? (Read More…)
The big news around here yesterday came from Bertel’s interview with Toyota’s Chief Engineer, in which it became clear that Toyota takes the developing world’s growing demand for oil very seriously. With global demand already outstripping supply, the giant automaker’s embrace of a petroleum-constrained business model seems to make it clear that gas prices will play a significant role in the future. But markets are, by their natures, both difficult to predict, and shaped by predictions. And Edmunds CEO Jeremy Anwyl reckons that, although gas prices are high and could well go up in the short term, fears of a runaway gap between supply and demand may not materialize over the longer term. He writes:
Here’s the twist: As I said, the consensus belief (or story) on future oil prices is that they will be higher. And short term, this may be the case if and/or when the global economy recovers and/or demand grows in emerging markets.
But there is a longer-term story as well. This story suggests that peak oil may be nigh and the future holds shortages and sharply higher prices. Buying into this story, companies, acting individually, will see profit in expanding exploration, developing sophisticated new extraction technologies, etc.
The aggregate result of all these individual activities is that the future supply of oil will improve and prices will actually drop.
In fact, we have seen this paradox play out before. Through the Seventies, we were first shocked by rapid price increases and then conditioned to believe they would continue. And, of course, oil prices collapsed in the Eighties.
Who’s ready for some politics? With the presidential election still over 14 months away, recent Iowa straw poll winner Michelle Bachmann is upping the campaign promise ante by telling a Greenville, SC crowd
The day that the president became president gasoline was $1.79 a gallon. Look at what it is today. Under President Bachmann, you will see gasoline come down below $2 a gallon again. That will happen.
Without even taking a side in the muck of presidential politics, it’s plain to see how ridiculous this statement is. As Politico helpfully notes:
Bachmann didn’t detail how she would cut the price of gasoline, which is tied to the global price of oil. [Emphasis added]
Personally, I think gas should probably be taxed to a point where Americans pay about what the rest of the world does, in order to pay for the externalities of oil consumption. Most auto execs agree, arguing that America’s artificially low gas prices play hell with product planning. But even (or is that especially) if you’re a hard-core anti-tax free-market fundamentalist, Bachmann’s statement should be treated with scorn. After all, markets, not presidents, should be setting oil prices. But what’s principle (or even good practice) when compared to the need for political pandering?
Hi, Sajeev. I have a dilemma that I need your advice on.
I’m in a rural area of Central Ohio and have a 2000 Ford Expedition Eddie Bauer, 5.4 V8, just shy of 144,000 miles, leather, 3rd row seat, air suspension, etc., etc.. We got it to tow our livestock trailer, but now with an ’05 Chevy Silverado 2500 Crew I no longer need it (daily driver into Columbus is a ’10 Subie Forester). It’s all paid for, so no pay off issues. It’s in pretty good shape, clean, loaded to the gills as most Eddie Bauer editions are. It has some electrical glitches that no one seems to be able to fix, so when it’s parked, all the time now, I have a battery cut off switch to save the battery. The engine did blow out a spark plug awhile back but the local dealer was able to helicoil the head and it’s held up.
Steve and Sajeev: I was hoping to pick your brain for a second regarding the used Prius market right now. Help a Hammer Time follower out! I own a 2010 base Prius (Model II), and I have been seeing listings at local dealerships for base model Prius’s (????) selling for 3-4K above new MSRP prices. For instance there is one with 15K on the clock selling for 27K, when new the MSRP was around 24K.Is this actually occurring right now or are these people out of their minds? My wife and I were debating on selling it and buying a cheaper car with a smaller payment if we could actually make a decent profit on it. On the other hand, 50 MPG in the era of $5 a gallon gas is pretty great. Its a gas! Thanks for your time.
And Sajeev, I always wanted a Mercury Marauder!
Why do consumers like CAFE? Well, the short answer is that a gas tax (which is infinitely superior from a pure policy perspective) hits them directly in the pocketbook, while CAFE forces automakers to absorb the cost increases before passing them along to consumers in the form of higher MSRPs. But underlying this fact is a larger issue that’s driving support of increased emissions regulation: gas is getting more expensive. As I pointed out in my recent editorial on the subject, for all the automakers’ whining about CAFE increases, it seems that energy prices are moving the market in the same direction anyway (the average family will spend $3,100 on gasoline this year).
According to a Consumer Federation of America study [PDF], the steadily-rising price of energy has consumer’s even more concerned about gas prices and dependence on the volatile Middle East than they were during the height of the last fuel price shock in the Summer of 2008. As a result, support for a 60 MPG fuel economy standard doesn’t go below 49% (among Independents) even assuming a ten-year payback period, and earns the support of 63% of Democrats. And before you dismiss this support as hysteria, consider the underlying economics for a moment…
This video says it all.
Pity the automotive industry. With a minimum three-year lead time for new product development, timing vehicle launches to coincide with appropriate fuel price levels is never easy. Chevy’s Volt, for example, was developed and hyped during the gas price spike of 2008 when it seemed almost anyone would pay a hefty premium to ease some of the pinch at the pump. Now though, with gas prices holding steady at around $3, there’s reason to question whether consumers will flock to unproven, expensive vehicles like the Volt, absent a pressing economic incentive to reduce gas consumption. The Freep takes on this topic today, asking with gas prices so low, will anyone buy a Volt? And this is not mere media hype. Bob Lutz fretted about this possibility last year, when he said
If gasoline stays cheap, then the American public says, “I’m not interested in that; I will keep my Tahoe longer.” It puts us in the industry in a position where we are at war with the customer
This would be a depressingly familiar position for GM to find itself in, especially since it would be a product of The General striving to do something different. Gas prices are slowly beginning to go up again, but there’s no sign that this summer will see the kind of energy price volatility that will have the Volt and Cruze (let alone the Nissan Leaf) flying off dealer lots. Do you see gas prices going up soon? How expensive will gas need to be before Americans see cars like the Volt as a mainstream option? What happens to the Volt if gas prices stay level, or even drop? No only are these intrinsically interesting questions, but there’s also lots of money (including lots of taxpayer money) riding on the outcome. What say you?