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It's finally happening. It only took $4.50 per gallon of gasoline to start it, but the wheels are turning.
OK, so the wheels actually aren't going to be turning anymore. That's probably a good thing.
With gas prices on the rise, SUV sales and sales of large trucks have been falling. And for good reason.
If you drive a GMC Yukon, that gas tank holds about 26 gallons. If gas costs $4.50 per gallon, to fill the tank would be over $100. And with the wonderful fuel economy of such a large vehicle, you'll probably have to fill about about once a week, maybe once every two weeks depending on your commute and driving habits. Either way, you're looking at spending between $200 and $400 a month on gasoline alone. When I combined my love of cars and love of online shopping, I found a number of different small cars that I could buy for about that same amount of money. I'm not the only one who's seen the light, either. People are buying smaller, more fuel efficient cars and automakers are finally catching on.
According to a press release from General Motors, four factories, "Oshawa Truck Assembly in Canada, which builds the Chevy Silverado and GMC Sierra, will likely cease production in 2009, while Moraine, Ohio, which builds the Chevy TrailBlazer, GMC Envoy and Saab 9-7x, will end production at the end of the 2010 model run, or sooner, if demand dictates. Janesville, Wisconsin, will cease production of medium-duty trucks by the end of 2009, and of the Tahoe, Suburban and Yukon in 2010, or sooner, if market demand dictates. Chevrolet Kodiak medium-duty truck production will also end in Toluca, Mexico, by the end of this year."
GM also said it would "work closely with its union partners to mitigate the impact of these difficult actions, which are made necessary by long-term changes in consumer demand for trucks and SUVs." But the SUVs aren't going away entirely. GM plans on fitting more models with their Flex Fuel system. Flex Fuel gives drivers the option of filling up with E85 ethanol, gasoline, or any combination.
GM is also offering cash incentives to move different SUVs and trucks off dealers’ lots.
Since GM isn't going to be making as many large vehicles, it is going to shift its attention to smaller, more efficient cars.
GM isn’t the only automaker feeling the effects.
Ford, noticing the decline in truck sales, has offered customers the opportunity to buy trucks at the same price Ford employees pay.
But sales of these automotive monsters don’t seem to be improving.
Instead of the traditional SUV, it seems like more consumers are choosing crossovers. Crossovers have almost as much space as most of the large SUVs, but they ride and behave more like cars because their structures are similar to cars. SUVs
I never thought people would abandon their SUVs and trucks and drive smaller, more efficient cars, but when gas prices near $5 per gallon I guess they realize that driving your kids to soccer practice in a tank maybe be just a little extreme.