By now you've surely noticed that gas prices have stabilized at around $2 a gallon (or less, depending on location) in the United States. That's about half of what gas cost just about one year ago, which is both a blessing and a curse, depending on how you look at it. Add Bill Ford, Executive Chairman at the automaker that bears his name, to the list of those unhappy about cheap fuel. He says:
When gasoline went to $3.50 a gallon we saw a sea change in customer behavior. Now people are turning away from more fuel-efficient vehicles and taking the bigger vehicles. I've been talking for five years now about the need for a gas tax. We have to have some predictability on fuel pricing and that price signal has to be strong enough so customers will continue buying smaller, fuel-efficient cars.It's certainly not a popular view among many, but Ford's assertion that an artificial increase in the cost of fuel would force consumers into choosing more efficient automobiles is likely accurate. It would also make it much easier for automakers to plan future model launches, knowing that new car buyers would want to purchase a vehicle in two years that will save on their monthly fuel bills.
[Source: Green Wombat]