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Nation's bad news alters public's car-buying habits


I've always wanted to lean in close during an interview with a muckity-muck in the auto industry and ask him or her, "Do you really believe what you're saying?"

The question would be especially pertinent today to anyone trying to downplay the impact that gasoline and diesel prices are having on consumers' lives.

Simply, there are too many things going in the wrong direction in our world to believe any longer that American consumers will, by and large, maintain their freewheeling ways on the road.

Worry rises with fuel prices

Blame it on fuel prices at the pump and on the growing worry among Americans about global warming.

Chalk it up to fear about the U.S. economy, and a recognition that the growth areas of the world like China and India need to tap the planet's oil resources like never before.

Honestly, who would believe, deep down, that fuel prices will fall appreciably and return to more "acceptable" levels in the United States for the long term?

Consumers I know already have absorbed this bad news and are shifting their thinking.

I hear it in the weekly conversations in the office, where co-workers complain how they're paying more than ever to fill up their vehicles and can't believe the final bill at the pump is $60, $80 and more.

They're sharing stories about the theft of gasoline from parked cars and wondering about buying locking gas caps.

In fact, the first concern from a co-worker whose PT Cruiser was totaled in an Easter Sunday crash was how to find a replacement vehicle that she can afford and that gets much, much better fuel mileage. She's adamant about getting better mileage than she did with the PT.

Hummer dealership closes

There are other signs of change.

I've never had non-auto-industry friends buzz about the closing of a car dealership. But friends were all over the recent closing of a Hummer dealership in Silicon Valley.

The dealership owner told the local newspaper that he didn't want to invest anymore in the Hummer facility because it "didn't pencil out" as a good business proposition.

Yes, even in Silicon Valley, which has been growing in population and jobs and where the median household income is $90,000 a year, registrations of new Hummers dropped 49.3 percent last year from 2006, according to the California Motor Car Dealers Association.

Throughout California, in fact, registrations of new Hummers declined more than any other brand -- 41.1 percent.

The brand that showed the highest increase in the state in 2007 was BMW-owned Mini, at 16.2 percent. Mini's cars are among the smallest on the road and come only with four-cylinder engines.

Saturn had the highest increase among U.S.-based car brands at 4 percent.

I have no doubt that more statistics charting major, historic auto industry changes will be coming along shortly to illustrate the consumer shift that's under way.

But the signs are already all around us.



[source]


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