So far outside the box you can't even see the box from here.
Friday, November 14, 2014
The unexpected drop in gas prices has stimulated SUV sales. How does this make any sense? Let's say we get real lucky and the price of gas stays at its lower rates for a year. Heck, let's get crazy and say that it stays low for two years. Most folks finance their vehicle purchase. 6 year loans are pretty common. When the price of gas shoots back up they'll still be on the hook for 4 – 5 years of SUV payments.
Maybe they think they'll just trade it and get something more fuel efficient if the price of gas shoots up again. They could do that, but anyone else remember what happens to trade in values of gas guzzlers when gas prices are high? What happens to people's memories when they go car shopping?
I'm not against SUVs in principle. For some things they make perfect sense. Contractors can put a bunch of workers and their tools in one. What doesn't make sense is all the SUVs out there that have just one or two people in it 99% of the time.
Of course, I'm the guy who desperately looked for alternatives when gas got to a dollar. A dollar for a gallon of gas? Outrageous! Who can afford that?
SUV sales is just part of a larger human problem of perception. We expect tomorrow to be pretty much like today. Too many of us make long term decisions on short term conditions.
I live in an area of NH known as the Great North Woods. I'm in my dome-i-cile out in the county with my lovely wife and a varying number of family and friends
-part red neck, part hippie but all country. Experimenting and enjoying the adventure of life.