As Gas Prices Rise, Automakers Benefiting From Strong Sales of Efficient Cars

Each time gas prices rise substantially it’s hard on the economy in the short run, but in the longer term it encourages lower petroleum consumption because people switch to fuel efficient cars and trucks.

When people buy efficient vehicles, they spend less on gas and are more protected from rising prices, while freeing the US from the grip of dirty fossil fuels and the consequences of depending on foreign oil.

Automakers are benefiting from the highest sales in four years, gaining 16% in February, exceeding the most optimistic estimates, reports Reuters.

In addition to trading gas guzzling SUVs for vehicles that get better fuel economy, there’s a lot of pent up demand for people to get out of their aging vehicles and buy new ones.

Switching from a vehicle that gets 20 miles per gallon (mpg) to 30 mpg saves $930 in fuel costs each year, according to the Department of Energy.

It’s bad enough that before this latest rise in gas prices, it cost about $84 to fill the tank of a Ford Motor Co F-150 pickup truck – the best-selling vehicle in the US. Now, after gas prices rose 17.5% since the beginning of the year, it costs $100.

Older cars are also gas guzzlers – averaging 18 mpg – and the average car on the road is a record 10.8 years old, according to Polk Automotive. People save a lot on gas if they buy a new vehicle, even if they stick with a larger one.

The fuel economy of 2012 models is more than 16% higher than in 2008, and 20% higher than in 2002, when the average was 19.4 mpg, according to

The average fuel economy today is 23.2 mpg, but many models get at least 30 mpg and some conventional cars even achieve 40 mpg on the highway.

The last time gas prices shot up past $4 a gallon was under the Bush Administration in 2008. Since US automakers relied so heavily on sales of gas guzzlers, sales crashed, contributing mightily to their problems.

In 2007, sales were 16.1 million, but in 2008 they dropped to 13.2 million and to 10.4 million in 2009 – the lowest since World War Two after adjusting for population growth, says Reuters.

Now, automakers are benefiting because they have the efficient vehicles people want – they offer triple the models that get 35 mpg or better than they did in 2008.

President Obama’s new fuel economy standards, which still lag Europe and even China’s, require cars and light trucks to average 35.5 mpg for model years 2012-2016, and 54.5 mpg from 2017-2025. They literally double today’s mpg average, resulting in average fuel savings of over $8,000 per vehicle.

With only 2% of the world’s oil reserves, the US could let oil companies extract every last drop without making any significant effect on world oil prices … or prices at our pumps. The only beneficiary would be Big Oil, who would make a bundle.

Pumping oil from places like the Arctic might buy a few weeks or months of oil (really, that’s it!), but in the process we get more air and water pollution, and more destruction of our coasts and ecosystems. A spill in the Arctic, would put the BP spill to shame.

We can’t drill our way to energy independence, but the solution to high oil prices is simple – Use Less Oil.

And we can use less painlessly, simply by buying an efficient vehicle.

Here are some tips on how to use the least amount of gas while you’re driving:

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Comments on “As Gas Prices Rise, Automakers Benefiting From Strong Sales of Efficient Cars”

  1. Andrew Gross


    Oregon aftermarket fuel system reduces vehicle fuel consumption 30.1%

    Clackamas, Oregon, (March 15, 2012) – Absolute Business Solutions, LLC is helping with solutions we’re implementing to improve vehicle fuel economy and help reduce fuel prices, including our patented aftermarket VAPOR FUEL TECHNOLOGY fuel system solution, featuring certified CARB/EPA lab results of 30.1% fuel and related emissions savings. You can view the on-site six minute EE Times interview here:


    $2.1m (US) has been privately invested to date to get past the “proof of concept” to the “pre-production” fleet testing stage. This solution helps US consumers and private/government fleet managers achieve a 30.1% fuel savings, and also helps automotive and commercial vehicle OEM’s solve pending 54.5mpg (US Government) CAFE requirements.

    Aftermarket and after-sales consumer and fleet vehicle retrofits, (i.e., gas, ethanol and/or CNG), are initially estimated at over 3-5m per year from the 110m SUVs and trucks registered in N. America. More at:

    2. Separately,our new Absolute Safety Tire patented design solution extends and retract studs to enhance winter traction, reduces costly road wear associated with full-time studded tires, produces compressed air to maintain correct pressure within the tires, and provides a visual and audible indication of tire wear beyond the recommended limit.

    Maintaining correct air pressure in this tire provides an additional estimated 3.3 percent mpg advantage over conventional tires. More at:


    For more information about this topic, or to schedule an interview with Raymond, please contact:

    Raymond Bushnell
    Managing Member of Technology
    Absolute Business Solutions, LLC


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