|It’s not a surprise that low prices at the pump have an effect on consumers’ purchasing decisions, but since gas prices have been dropping so consistently, Colorado may see more and more trucks and other larger vehicles on the road.
St. Patrick’s Day marked the ninth consecutive day that gas prices have dropped, according to CBS Denver. The trend is expected to continue into summer, when gas may go as low as $2.00 per gallon.
ISeeCars.com, a used-car search engine, recently endeavored to study the correlation between gas prices and used car sales. The study looked at the sales of 27 million used car sales and gas prices over the last three years.
One of the most significant findings was that a $1.00 drop in gas prices correlated with a 2% increase in the light truck sales market share, nationally. This figure that was even higher in Colorado, where the study found a 3% increase in light truck sales market share.
“The trend we have seen over the last six to eight months is a movement to bigger and more comfortable vehicles,” said Tim Jackson, president of the Colorado Automobile Dealers Association, in an interview with the Denver Post.
Josh Hastings of Money Life Wax has some words of wisdom for those planning to invest in a new vehicle, though: “When you’re buying a car, make sure it’s value does not exceed 25% of your gross income – regardless of what you get approved for!”
What’s more interesting is that the market share for passenger vehicles sees about the same increase — 2% for a $1.00 drop. Hybrid car sales, however, are largely unaffected. This is also not much of a surprise, considering that one of the biggest draws of buying a hybrid is the impressive fuel economy.
Hybrid cars do save drivers money on gas, but they are also better for the environment than traditional internal combustion engine vehicles since they emit less greenhouse gases.
Drivers, though, are apparently paying less attention to the effect of their vehicles on the environment and are much less worried about fuel economy as gas prices drop.