With gas prices rising toward $4 a gallon, most people aren’t in much of a mood for spending.
But for drivers who want to eke a little more distance from each pricey gallon, it’s starting to make sense to make the trip to a car dealership.
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Many are now trading in gas-guzzling SUVs and minivans for cars that tend to sip gas.
“They’re coming out in droves,” said Tim Thomas, general sales manager of Berlin City Lexus on Riverside Street in Portland, which, along with its affiliated Toyota dealership, offers a fairly wide selection of high-mileage compacts and hybrid cars.
On Wednesday, Steve Warshaw of Raymond was at the dealership to sign papers on a Lexus CT 200h, a hybrid model so new that Thomas didn’t have any in stock.
Warshaw said he decided to buy the car, sight unseen, because of the hybrid’s mileage. Its estimated 42 miles per gallon is roughly double the efficiency of the 10-year-old Jeep Cherokee he’s trading in. He also likes its cargo room, and its lighter impact on the environment.
“I just think it makes sense to try to find a vehicle that will do what you want it to do, with higher mileage,” he said.
Other dealers are hoping to tap into drivers’ desire to switch to more fuel-efficient cars.
Lee Auto Mall Westbrook just got about a half-dozen used Hyundai Accents from a car rental company. To move the compacts, the dealership is running a promotion offering six months of free gas on a pre-paid card.
Josh Douglas, general sales manager, said the dealership advertised the offer in the paper and on the radio Friday morning, and within a couple of hours, five people had come in to get details.
Douglas said the shift of buyers’ preferences from size and power to mileage “is just starting to build.”
That shift is propelled by gas prices that averaged $3.69 a gallon Tuesday in Greater Portland, according to the AAA Daily Fuel Gauge Report. That’s up from $3.51 a month ago and $2.85 a year ago, and within sight of the all-time high of $4.13 a gallon on July 15, 2008.
At the pump, some people who aren’t in the market for a new car say they’re sticking closer to home to keep gasoline from hijacking the household budget.
Irfan Tara of Portland said he has given up road trips to visit friends in New Hampshire and Massachusetts.
“I just make it short trips,” he said, “because right now I’m on a short budget.”
One pump over at the 7-Eleven on Washington Avenue in Portland, Joe Henderson said $3.65 a gallon wasn’t enough to cause him to seriously change his driving habits.
“I stay within town most of the time anyway,” he said, and the prices aren’t “bad enough right now to change.”
Wait until gas hits $4 a gallon, experts say. That’s the psychological trigger for many consumers to change their habits.
For Metro, the Greater Portland bus system, buses started filling up when gas prices moved past $4 a gallon in 2008, said General Manager David Redlefsen. “That was the time that everybody put the keys on the kitchen counter,” he said.
Ridership jumped 10 percent from June of that year, when the price of gas was below $4 a gallon, to July, when it hit record highs.
Charles Colgan, an economist and professor at the University of Southern Maine’s Muskie School of Public Service, agreed that $4 a gallon is where consumers really start to change their habits.
But it would take prices of $4.50 to $5 to really dent the economic recovery, he said.
“It’s not good,” he said of the current rising prices, “but it’s not catastrophic, either.”
Colgan said rising gas prices drain money from the economy and force people to shift household and business dollars toward fuel, but they don’t necessary affect the overall direction of the economy.
He said that could change if world events disrupt production enough to drive the price of crude oil into the range of $120 to $140 a barrel. Crude was selling Wednesday for $108.83 a barrel.
If that does happen, Colgan said, high fuel prices will put a sharper brake on economic growth and start pushing unemployment higher again.
Staff Writer Edward D. Murphy can be contacted at 791-6465 or at emurphy@pressherald.com
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