Originally Posted By: LS2JSTS
If you review what the original article discusses. You will see that this spike is/was expected. The difference between the two is one sensationalizes and the other looks at the trend in a historical perspective. If history serves as a guide here, the spike will be short lived.
Time will tell.
Is it sensational if there is no real historical analogue to even call this a "spike"?
The trend over the past 10 years has, even eliminating spikes, been consistently upward in trajectory. What evidence is there to suggest that oil prices will only continue going upward?
Perhaps the US consumer percentage "driving" the increase in sales of smaller, more fuel efficient cars, upward are a sign of a trend, and not a fad.
Maybe the less fuel efficient SUVs and larger cars of the past, plus "vanity" automobiles (to use a term another poster has which fits well enough) in large trucks that never carry tools, tow, or leave the pavement, are the fad - a dying one?
In Europe especially, but also here in Canada, we are used to higher fuel prices, and are already paying the equivalent of $5/gallon US for gas. I'm certain it'll drop over the summer - same as it has almost every year before - but not to the same level it did last year, 2 years ago, or 5 years ago. And the fuel prices of 10 years ago are long gone, never to be seen again.
I will refrain from any political discussion, other than to mention the reality we are all aware of in that our largest tapped oil sources are - collectively - held by countries in unstable regions of the world. That instability is a factor that I don't think will end in the next 10 years. Do you?
Back to the purely economic forces, NA and Europe are huge oil consumers and our demand for fossil fuels continues to increase; as is China's, and their demand for energy sources of all kinds is increasing rapidly as they play industrial development with the west - yet their population dwarfs our own. What happens to fossil fuel demand when China reaches technological and industrial parity with the West?
I think the $3.50/gallon the US pays on average today will, at least within the next 10 years, and certainly long afterward, will come to be seen as "the good old days when gas was cheap."
There is an entire generation of drivers on the road and yet to be on the road, who are purchasing cars today, who have only known the high prices we've paid over the last 10 years. Maybe younger posters of that generation could shed more light on their own perceptions, but trying to imagine myself in their shoes, I would find the gasoline gluttons such as the Hummers that were the "rage" 10 years ago to be laughable as any kind of transportation option.
The majority of Americans and Canadians alike have limited amounts of non-discretionary income to spend on things like rent/mortgage, food, utilities, and transportation/fuel. You can only slice the pie so many ways, and as fuel costs increase, the income available to spend on it - assuming this as a constant - is still the same, and more fuel efficiency means is one very practical solution to keeping that slice of the non-discretionary spending pie from increasing, and thereby increasing funds for discretionary items (the fun stuff).
Long story short then, the quote from the VP at Ford makes sense and I don't think of this trend as a "spike." (in either fuel prices or the increase of more fuel efficient vehicle sales)
-Spyder
