High Gas Prices Are Discouraging Americans From Buying Cars

Few Americans are buying new cars right now, and for nearly half of those who didn’t buy a car this year, high gas prices were a big reason why. That’s according to a survey conducted by Harris Poll on behalf of TIME.

Earlier this month, gas prices in the U.S. hit an average $5/gallon for the first time ever—the result of Russia’s war in Ukraine, pandemic supply chain disruptions, inflation, and higher demand. The summer is upon us and people are eager to get on the roads. However, gas prices are nearly 2 dollars more than they were last year. This is making people reconsider buying gas-guzzlers.

This poll, which was conducted among over 1,000 Americans at the beginning of June, found that just 10% of those surveyed had bought a new vehicle in the previous six months. While the most important aspects of buying a vehicle are the price and the type, only half of those who purchased a car also said that they considered gas prices when purchasing it. That’s compared to 44% of people who bought a car saying they cared about the type of fuel the car used. About a third of respondents said they were concerned about the environment when deciding whether to purchase a vehicle.

This suggests that the immediate impact on people’s wallets appears to be a bigger influence in car-use behavior in the U.S. than the longer term implications of driving fossil-fuelled vehicles.

Justin Worland, my colleague, reported that gas prices would rise by $2.10 if congestion, accidents and pollution were taken into account. If such costs could be included, perhaps the U.S. car fleet will look different.

However, the environmental impact and gas prices are less important when renting a vehicle. The overwhelming concern for those surveyed who have rented this past year (about 15% of the total polled) was getting whatever type of vehicle they wanted for the best price—and for over 75% of car renters, that meant a gas-powered car. Just over three quarters of renters said that fuel economy and gas prices were important to them. A quarter however stated that the fuel used to drive their car was also important to them. Only 19% claimed they reserved an electric hybrid or electric vehicle.

However, this could change. TIME has Hertz inform them that they are seeing a rising demand for fuel efficient, hybrid or electric vehicles. And Enterprise Holdings—which owns car rental brands Enterprise, National, and Alamo—says that “when we’ve seen fuel price increases in the past, we tend to begin seeing consumer interest rise in fuel efficiency and alternative fuel options.”

Things likely won’t slow down, however, as we head into the hotter months. Enterprise Holdings says “demand and reservations continue to look strong for summer despite gas prices.” The company expects domestic travel to match last year’s high levels, with two-thirds of their customers in an internal survey conducted in June saying they planned to go on roadtrips. But, it added, “59% of those said they would consider staying closer to home as a result of the higher gas prices.”

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