I don’t think it’s my imagination. I now have a 12 mile commute, mostly on a freeway that starts as a 55 and changes to 65 as it gets further from the center city. Ordinarily drivers start heading up toward 80 about a mile before the signs change to 65. But recently I’ve noticed a big change- drivers are actually driving under the limit, averaging around 60, obviously because of gas prices. There is a significant savings by going 55.

Now my observations take place in a relatively wealthy suburban area where big cars and SUVs are still dominant. I’m guessing these guzzlers are becoming real financial liabilities. In the car business when you owe more for a vehicle than it is worth you are ‘upside-down’, a very bad place to be. If you’re upside-down when you go to trade-in the excess liability is often added to the loan for the new car- meaning you’re still upside-down even if you down-sized to something more efficient.

This is problematic for our economy. The rising fuel prices are a tide that raises all boats in ways we couldn’t have predicted. Even if you want to trade your SUV for a Civic it’s going to cost you and a lot of us are going to be even more in debt meaning we won’t be spending as much.

I drove by a local Hummer dealer the other day. It was a forlorn sight: A lot full of dinosaurs that had an extinction event and a showroom devoid of humans. Given the morons that typically bought these things one can’t help but feel that karma has kicked in. Unfortunately no one, no matter how righteous, is exempt from the karmic effects of our criminally conspicuous consumption.

The tide is rising.

 Techcrunch takes a scientist’s data and speculates about the economics of replacing all the cars in the country with electric cars.

* total oil consumption in the U.S.: 21 million barrels every day (CIA Factbook)
* cost per barrel: $130
* days in year: 365
* total spent per year: $1 trillion
* percentage of oil consumed by passenger cars: 40
* total spent per year on oil for passenger cars: $400 billion
* at 5 interest, how much we could we borrow and pay $400 billion every year in interest: $8 trillion
* number of registered cars in the U.S.: 250 million (Wikipedia)
* cost of a new electric car, if mass-produced: $20,000
* value of a used car, if exported to Latin America or China: $5,000
* cost to upgrade average existing American car to a brand-new electric car: $15,000
* number that could be converted for $8 trillion: more than 500 million cars (i.e., twice as many as we have now)

Of course this leaves out Americans’ unwillingness to give up vehicle choice.

My friend Franke does it again, riffing on her experience seeing Malcolm Gladwell and Mark Kingwell (don’t know who he is) talking about initiating social change. Her illustrations tell the story much better than I can so I’m just going to add a little of my perspective to her observations.

Franke is Canadian so maybe things are different across the lake but I doubt it.  Simply put, Gladwell argues that awareness is not enough to change behavior and Franke notes that sometimes a threat or pain point must be reached.

I’ve been noticing a lot more Euro-versions of cars appearing on the streets in Rochester- little tiny Hondas, Toyotas, Fords, etc. These cars are literally a fraction of the size of the SUVs they are hopefully replacing. So why are they appearing now? Could it be $4.25/gallon gas? Even a wealthy SUV driver might have issues with paying five bucks for gas to run out to the store or a movie…

A point I’ve belabored here is that change and response to  climate issues will only be driven by economics. Americans don’t want to believe it will affect us so our politicians won’t act. Awareness and acceptance of the issue is there but there isn’t any urgency- until we get hit in our wallets, painfully.

“Forever is composed of nows”

Emily Dickinson

Honda thinks my new Civic will be worth $12,000 three years from now. I don’t think so. Here’s why.

Gas is inevitably going up up up because of emerging, energy-hungry markets in Asia and the rest of the world.

Higher Demand+ Limited Supply= Higher Prices.

A car that gets ‘only’ 25/36 MPG won’t be in demand.

New car technology, including plug-in hybrids, will be the standard because the demand will be intense and the technology exists now.

As the Car Lady pointed out in a recent comment, leasing is definitely the way to go right now because of these factors. Things are changing so fast that you can’t risk owning an expensive piece of equipment that will become outdated before it is even paid for.

Welcome to the future.