Subscribe to RSSWhat effect does gas price have on consumers?
Gasoline prices have been on the rise for the past three years and 2007 seem to be on a track to beat last year as the highest on record. We looked into our data at Compete to see how high gas prices are affecting consumers.
We compared the monthly people count from websites GasBuddy.com and GasPriceWatch.com against the average gas price price for that month. We saw a general correlation between gas prices and GasBuddy.com"”as gas prices increased, visitors to GasBuddy.com also increased. But the thing that really stuck out was the peaks in the visitor counts corresponding to subsequent gas price media releases.
We were able to match these single month peaks to news reports affecting gas prices:
- May 2004: “Gas Price Surpasses $2.00 a Gallon”
- March 2005: “Gas Price at Record $2.109 a Gallon”
- September 2005: “President Bush Warns Against Looting and Gas Price Gouging”
- April 2006: “President Bush Orders Gas Price Probe”
- June 2006: “Gas Price at Record $3.00 a Gallon”
Although people complain about the rising gas prices, it seems like they need someone to point out the rise before they become truly engaged (online) about the subject; a news report can increase people’s interest in gas price websites as much as 300%–a lot more than what gas price can do on its own.
When you look at the proportion of cars (which generally have better fuel economy) and light trucks (which generally have poorer fuel economy) registered, the light trucks peaked at 55% in 2004 versus cars at 45%. In 2006, light trucks represented 53% of the total and cars 47% so people are slowly shifting towards more fuel efficient passenger cars (versus less fuel efficient light trucks"”pickup trucks, SUVs, and mini-vans). Although there are many other factors involved in vehicle purchase, it looks like high gas prices may be affecting consumers’ choice of vehicles.
Is the biggest impact to the consumer caused by weekly price increase? Is there a threshold price that makes people think twice about filling up? Gas prices rise so gradually that it’s difficult to perceive the change in everyday life. But when it suddenly costs you $100 to fill up the 39 gallon tank on your Chevrolet Suburban, that may perk your attention.
