Winners and losers in the age of $4+/gallon gasoline
As usual when the status quo changes, there are those who lose out during the transition. When the self-propelled automobile took hold in the early twentieth century, the buggy whip and saddle manufacturers felt the pain. However, where you find losers, there is usually someone who finds himself on the positive side as well. The numbers are often disproportionate in the early going, but over time industries and people invariably adjust. Right now, in this time of $4 gallons of gasoline, we are still deepiy into the serious pain phase and we're simply going to have to tough it out. Among the biggest losers right now are ordinary consumers and drivers. With so many Americans still driving trucks and SUVs, the cost of filling the fuel tanks is rapidly getting unbearable and even those trying to unload their guzzlers for more efficient vehicles are having a hard time with plummetting resale values. In spite of the economic pain a lot of people of feeling right now, higher gas prices will likely have a positive long-term impact. Car buyers have long demonstrated a preference for buying the biggest, most powerful vehicles they could afford. This has meant that the U.S., with some of the lowest fuel prices in the world, has been dominated by those types of vehicles. On the positive side of the ledger are companies that helping bring along more efficient technology like Toyota and A123 Systems. Interestingly, automotive components and systems suppliers fall on both sides depending on what they make. Suppliers like Dana and American Axle that produce parts like axles for full-size trucks are in serious trouble. Others - like Bosch, Continental and Honeywell that make fuel systems and turbochargers that will be increasingly used over the next few years as engines are downsized - look set for a major boost. Forbes has a look at some of the other winners and losers.[Source: Forbes]
Reader Comments (Page 1 of 2)
jpm100 8:28PM (5/18/2008)
And then gas will fall $2.50 and the shoe will be on the other foot.
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Dad 9:13PM (5/18/2008)
“In spite of the economic pain a lot of people of feeling right now"
Look at Pres. Clinton track record of doing absolutely nothing for 8 years except
1) dollar a gallon gas
2) SUV sales exploded
3) No renewable energy support or initiatives.
4) Dot Com bubble
If Pres. Clinton had done anything we would not have to endure this pain.
The reason we are in such pain is that Bill Clinton did NOTHING for energy independence, all supported by a paper trail.
If Clinton had done anything for energy conservation, we would not be in the trouble we are in now. Lot's of big thirsty SUVs and no energy program. We are 8 years behind where we could have been because Bill Clinton did NOTHING. Enjoy the pain that 8 years of neglect under Bill Clinton produced.
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BlackbirdHighway 9:56PM (5/18/2008)
Wow, Dad, I had no idea that Bill Clinton has been the president for the last 7 years. Here all this time I thought it was some guy that goes by "duwba". Thanks for setting us all straight on that!
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MikeW 10:04PM (5/18/2008)
Don't forget what the Neocons did, like destroy the currency, foment wars of aggression based on the 9/11 myth which has added over 50% of speculation to the price of oil.
and they aren't done yet, we are to the west, east, north and south of Iran.
I had hope that the Partnership for the 'next generation' of vehicles would produce some results. Cut weight, cut aerodynamic drag, improve engines & transmissions, etc. but those damn SUVs...
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Chris M 10:11PM (5/18/2008)
Bill Clinton DID do something. He started the "Partnership for Next Generation Vehicles" that was supposed to create a very high milage vehicle. The big 3 spent billions and came up with hybrid prototypes by 2001, but then dropped the ball, as Bush canceled the program. Toyota and Honda, shut out of the PNGV program, developed their own hybrids and got them on the market before the PNGV prototypes appeared, and now dominate the hybrid market.
You could argue that Clinton didn't do nearly enough, but at least he tried.
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stevefazek 10:16PM (5/18/2008)
Dont forget how ironically when we started to talk about war with iran was the same time Iran announced they where selling oil in EUROs. A week before the they where to start it the internet went down in the middle east when 3 cables were cut in a day. Gee who has subs and the ability to cut cables under water?
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gsolman6 11:23PM (5/18/2008)
Loser: Supercommuters may only be a rich man's option in the future. I know the one at my office has been clamoring for the one day a week teleworking option.
Still this is a golden opportunity for us to reevaluate the way we develop or cities and suburbs; density; mass transit; mixed use zoning, etc.
Winner:
Me and people like me who bought homes near major employment centers. Yes we may have sacrificed the granite countertops and stainless steel appliances that are somehow necessary but having mode choice (car, bus, or bike) and a short commute with less fuel (a gallon and a half/week) is a great benefit......
Winner: I think coal and potentially nuclear could be big winners if there is a large switch to electric cars with all the new power plants being needed.
Loser: People who live in rural areas and people that need work vehicles. They may be able to pass some of the extras costs on to their customers for the latter but overall it is a loss.
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Gregg 3:29AM (5/19/2008)
Well, the President of the United States will not be able to control the rising gas prices. Our ignorant President Mr. Bush is now blaming China and India for rising fuel prices. He conveniently forgets about the Iraq war he started - which was mostly responsible for the increasing oil prices.
Recently I came across simple technology by which we can modify cars to run on a mizture of water and gas. My friend tried this technology and he is very happy about the savings. I am going to test this on my old car. You can find more details of this technology at
http://www.water4gascars.com
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David Wright 3:39AM (5/19/2008)
Winners: Investors selectively identifying PROFITABLE makers of electric vehicles. Companies that have them in production and out there on the highway, not just on display at auto show after auto show. Step forward UK-listed Tanfield Group (LSE:TAN), the engineering company that owns Smith EV www.smithelectricvehicles.com
They now have several hundred all-electric trucks and vans in service with parcel delivery firms and supermarket chains in the UK and beyond - and are about to open a new factory in the US in collaboration with Ford, to produce this all-electric version of the Ford F650 http://i29.tinypic.com/307raqg.jpg
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Chris 6:01AM (5/19/2008)
Losers : Anyone driving a gas guzzler for style. Why are there so many simpletons on this site who only affix that label to SUVs? My friends M45 gets 18 ON A GOOD DAY. Half the time he is lower. Hell most semi-luxury cards average 20. (my previous G35 MT6 got 21 and only because I drove it nice)
Sorry but 20 sucks as bad as 15.
Winners : People who haven't wasted their money on bullshit selfish things they thing they are entitled to. People who don't have CC debt and the like.
My parents drive their Allegro about six to eight thousand miles a year; it gets 7 to 8 mpg. It annoys them but look at it this way, even $4 gasoline shouldn't bother many people - especially people who own their own homes and such.
The simple fact is, too many people bought expensive high horsepower vehicles so that they literally could keep up with the Joneses. It doesn't matter if you live near where you work; I don't - I commute 26 miles one way GRANITE COUNTERTOPS FTW - and don't give a shit about the commute.
If you don't kill yourself with monthlies (read: over priced cell plans (read:twits with iphones), super duper cable/satellite, sat radio, etc) and don't live with a fleece because you couldn't afford what you are driving you will be fine.
IOW - if your conservative/responsible in your lifestyle you will be fine. You won't be lining up to vote the next polio in who promises you gasoline assistance; don't laugh they are already writing the legislation to help "poor" people buy gasoline
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FThorn 7:02AM (5/19/2008)
Gas will never go back down.
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Mike J 7:33AM (5/19/2008)
Loser: VW for not selling their small cars here. WTF are they waiting for??
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Galley 7:55AM (5/19/2008)
The link's not working for me, but I'll agree, Folks who choose to live close to work are definitely winners. I drive less than 8,000 miles per year.
Other winners are bicycle shop owners. Sales of bicycles have gone up dramatically.
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iHero 8:01AM (5/19/2008)
Let's stop placing blame and start doing something about the problem.
Here is a start for some us:
Http://www.hybrad.com
What are some other ideas?
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stevefazek 8:23AM (5/19/2008)
Loser, GM, Ford, Chrysler, for not selling their best cars here. For pretty much cheating the cafe system by getting the law changed if you only make giant gas guzzlers then you dont need to meet 35MPG.
That was the point of the 35MPG law to kill gas guzzlers.
America is filled with worthless greedy morons. We saw this coming 35 freaking years ago and we did nothing
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BlackbirdHighway 8:53AM (5/19/2008)
The Forbes article seems to neglect the fact that high oil prices will certainly cause a recession. I guess their readers don't want to hear about that.
Other losers: the US economy, which may be in recession, mabe even depression, for a long while. US consumers who are deeply in debt, and will soon find out that recent changes in US bankruptcy law mean that they will be stuck paying off those debts no matter what. US retirees, who will be hit hard by high inflation.
Another Winner: Europe, which has already adjusted to high fuel costs, and has a strong currency.
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David Wright 9:06AM (5/19/2008)
My current car (Citroen Berlingo) averages 38mpg. That would feel quite good if it were not for the fact that my previous VW Polo averaged 45mpg and could manage 52mg at a steady 55mph.
I am talking imperial gallons - as used in the UK (about 20% bigger than a US gallon).
My mother's Smart car achieves 63mpg. And 40 years ago my old Morris Minor gave me between 35 and 40mpg. So I am always quite shocked when I se sub-20mpg figures being talked of on American sites - even allowing for the smaller US gallon. It's as if the US have never even bothered trying to improve mpg - which I guess is probably the case.
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George 2:37PM (5/19/2008)
Yep! We all seen it in the 70's, The Japanese auto makers got their foot hold and now they are on top!
The "big three" little it happen, shame on them! If they would of done something back then and if we could keep our nose out of other peoples business..... fill in the blanks!
So we'll get used to $10 a gallon gas and this whole thing will start yet again... some people just dont learn!
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Nikax 10:47AM (5/19/2008)
I do notice that most of the congested commute traffic in this area is single occupant (and often large) vehicles. Many people still refuse to carpool or use public transport, still insist on driving two hours per day to get to work. I think higher fuel prices will reshape our urban landscapes and lifestyles for the better. Hopefully we can develop neighborhoods rather than the suburban regional shopping center /massive driving model that we've got now.
I'm able to combine telecommuting (not an option for everyone, but it can be extended to more workers) with walking and bicycling for things in my neighborhood, with motorcycle commuting when needed (45 mpg), and occasional use of my truck (>1000 miles/year). Saves a lot of money on fuel and vehicle maintenance.
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Nikax 10:49AM (5/19/2008)
sorry, I meant "
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