May not be bad for car companies
San Francisco, CA -- (SBWIRE) -- 02/25/2013 -- The recent surge in the gas prices may end up being positive for car companies. Leaving only the consumers to be the ones muttering expletives as they fill their gas tanks.
Prices have been rising over the course of February, and depending upon the part of the country one calls home, certain areas are seeing prices as high as $4.00 once again. Past spikes would create a spike in smaller car sales. However, the last few times prices rose, It actually helped the overall vehicle sales.
“The vehicles on the road today, are very old, and those are not the most fuel-efficient,” says Michelle Krebs, an analyst with Edmunds.com. “This could well spur some sales, as people will want to trade in old, less fuel-efficient, vehicles for the new modern, fuel-efficient vehicles.”
Numbers show the average vehicle on the road is more than 11 years old. Krebs stated that often the higher gas prices lead buyers to realize that it is time for them to get something that is both newer and more fuel efficient.
Smaller SUV's, as well as small crossovers, have been seen as strong sellers during such times.
Analysts state that Michigan gas prices, which have now been flirting with $4 per gallon, were pushed up by this interesting issue.
We continue to be dogged with refining problems in this region,” said Patrick Dehaan of gasbuddy.com.
Deehan noted a lot of situations arise and come to a head in a short period of time.
“In the past week, we’ve seen four refinery upsets, four refineries in the region suffering problems. I can’t imagine it getting a whole lot worse.”
We may see some moderation in the gas prices once the refineries are back online; however, Dehaan stated that prices are at or near the record levels for the particular season. It raises concerns of higher gas prices as we creep ever closer to summer travel season.
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