Interesting chart, via Mike Panzner:
click for larger chart
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As the price at the pump probes new extremes, so does the size of the hole in the wallet…the trick is figuring out where the Price that gasoline really bites the consumer hard.
Speaking personally, $3 gas ($3.39 premium this weekend) hurts, but it hasn’t altered my driving habits. I still drive too fast to be economical or fuel efficient, I take the high horsepower vehicle out on weekends (under 20mpg), work my way through the gears quickly off the line, and sometimes just go haulin’ out for a cruise for some good clean fun. Surprising M3s has become my dirty little pleasure.
If gas stays over $3 gallon, I’ll pile everyone into the truck on Summer weekends to go out East to the beach, rather than taking 2 separate cars . . . which was hardly the model of fuel efficiency.
Has high prices changed your habits? How?
UPDATE 2: May 7, 2006 6:48 am
Dan Gross’ NYTimes column today is called "Why Prices at the Pump May Have Little Bite"
The column goes into detail about what the chart above shows: Gasoline is still only 4% of a family budget, and therefore rises (while annoying) are still absorbable by most families.
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UPDATE: May 3, 2006 6:24 am
A few articles suggest that fuel prices are starting to impact purchase decisions:
The chart doesn’t tell us much since they don’t break the figure down by income levels, which is where the real story is. Rich people don’t need to worry about gas prices. The poor do.
I think the real issue is the relative ratio of pay per week and cost of driving. Thus, if someone is getting $500 per week (take home) and spending $75 to get there, then they are spending 15% of disposable income. If their housing is $250 per week and food $100 per week, guess how soon their “miscellaneous purchases” become 0…
surprising M3’s? in what? its not the car you are surprising its the driver.
We sold our SUV and bought a smaller, more efficient car that gets great mileage…IT SUCKS!!! The new car’s small enough our two boys (2 and 3) can hit eachother from their car seats.
I don’t drive much, so personally, the increasing prices have little affect on me. What I have noticed (ad hoc) in my area is an increasing dependance on public transit.
I run a 40/60 cocktail of used motor oil and diesel in my old Ford truck. It spews pollution like a liberal democrat on election day.
For about a year, I have been riding the bus, which says a lot about how bad gas prices are in LA. The one good thing is that, at $52 a month, the bus is really cheap (but EXTREMELY unreliable), and I find I can get through most week days without driving. However, on the weekends, I have to break down and fire up the RAV4 to do shopping and errands. It uses regular and costs about $35.00 to fill.
The Pasadena Gold Line is a God-send.
All,
Drive less and save $ while doing your bit for the environment. Climage change is happening!
On the weekends we don’t go down to Atlanta, we just stay really local. We also eat out much less. It does hurt here.
I run a 40/60 cocktail of used motor oil and diesel in my old Ford truck.
at least you’re recycling
Gas Prices As A Percentage of Disposable Income
Chart via Barry Ritholtz:
The share of disposable income has risen from 0.022% to just above 0.030%. While this is a substantial increase, it is still a very small number and thus has seemingly done nothing to restrict demand for gasoline. Individua…
This gas increase has hit me pretty hard, because I can’t change my driving habits. Being in the Dallas-Fort Worth, public transportation is horrible, and they don’t even run from my house to where I work.
Gas is unbelievably high here considering they have refineries in this state, and I know for a fact that it is cheaper in Kansas City which has no refineries.
I read soemwhere that the cost of gasoline represented a 1:10 ratio for our disposable income. Now it’s up to 1:16 meaning for every $16 we spend on disposable income, one goes to gasoline and that’s why a good chunck of us have not really felt the higher prices as we did back in the 80’s.
My commute is 6 miles rountrip. Add in a trip to the military base to workout, and I’m still only putting 10mi per day on the car. Its a subaru wagon (gotta have AWD here, literally 35-40% of the cars on the road up here are AWD subys)..gets about 22city 26hwy.
I might not take a few of the fly fishing trips I normally would that are a few hundred miles away, choosing to fish waters closer to home. But I’m a stingy bastard, saving every penny so I can take 2007 and 2008 off to recreate. My savings rate is about 70% of after tax income.
David Taylor your math is excruciating buddy.
Perhaps you mean from 10% to 16%. Otherwise, you are polar opposite what you intend…i.e. 1:10 = 10% which is more than 1:16 = 6.25%
Whoops, I stand corrected. Your point was it was higher in real terms and in terms of income in the 80s?
That’s what I get for shootin of my mouth before coffee
Saw this coming last year, and traded in the very nice 2-yr-old 6-cyl automatic Passat wagon (<20 mpg) while it still had any resale value left at all and which under normal circumstances I would have driven into the ground, and bought a manual diesel Jetta wagon (>40 mpg) which I absolutely love. Big enough to carry the two of us, the kids (when they’re around), and the big doggie in the back.
Even though diesel costs more than premium at most places around here, I still smile every time I get in the car. And I *really* smile when I wave hello to the poor schlub in the Suburban next to me at the gas station.
I’m back to huffing paint thinner instead of gasoline. Gas is just too damn expensive.
Three years ago we were ready to trade in our Ford Explorer for another SUV (which we need to pull our fishing boat). They had upsized the Explorer which meant the gas milage would be even worse than it was. I convinced my hubby to check out the Escape and we ended up with one. Our gas milage improved by about 25%, from our old Explorer. There would have been an even bigger difference if we had bought the new Expedition.
Love our Escape. It pulls the boat fine. We didn’t opt for the four wheel drive which helped with the milage.
My old Honda Accord, pushing 100,000 miles, still gets almost 30 MPG.
And yes, we are more thoughtful in our driving habits. Much more likely to “bunch” our errands into one trip.
Since we are retired we are able to do that easily.
I’m an asst mgr of a national chain supermarket, living and working in Ventura county, CA. not much mass transit here, just metrolink and Amtrak. We’re seeing an uptick in payments tendered in Susan B. Anthony and Sacajawea dollars. (That is the change returned to people buying tickets for metrolink and Amtrak using their automated ticket machines.)
semper fubar, have your Jetta’s windows fell out yet? (actually down in the door) My son’s did during the coldest spell we had last winter. The VW dealer said “see you in two weeks”. He drives a Honda now.
Todd,
You really need to try some of the industrial adhesives. They are more expensive but you are missing out. If you need some recommendations, let me know.
Me and my friend went through a period of gas huffing that lasted about a month. Let me start by saying I have tried alot of drugs and never in my life been as messed up as gas huffing gets me. It is horribly dangerous, tastes disgusting , and leaves a huge hangover. We would hold our mouths to the rim of the open gas can and inhale the fumes for about thirty seconds each, passing the can back and forth. after about five minutes we would completely lose ourselves. The first thing that hits you is a wave of the most powerful dejavu you will ever feel. (I have recently heard that the feeling of dejavu is associated with some forms of mental retardation).
Every single noise echoes endlessly and audio hallucinations are extremely prominent especially outside. Car horns, helicopters, dogs barking, mothers calling for their children. I heard all these thing echoeing in an endless loop through my head but don’t know which of them were real and which were hallucinations. Strangely every time I huffed I would hear the same sounds echoing through my head and they would form a sort of song. I enjoyed the song so much I looked forward to hitting that peak just so I could hear it. I could almost make out words amidst the echoing noise, and would drive myself to the brink of lunacy trying to discern these jumbled beautiful lyrics. I even went so far as to try and write them down at the peak of my ‘huff’ and was ecstatic when I thought I had done it. Finally put in writing this strange song that teased my mind for so long. But when I finally came back to reality all that was on the paper was black scribbles. I gave up on the song.
Another time I was huffing on the side of my friends house with him, and suddenly realized I was in Australia. I knew I had always been there and it was my job to catch boomerangs thrown from America and translate the messages written on them. It sounds idiotic but at the peak of a gas huff anything goes and you take what you can get. My friend has reported being taken into a cartoon version of the world, and a room filled with silver confetti where a huge eyeball floated in fromt of him and a deep voice laughed from the distance. I was once transported back to my childhood where I stood in a park on a summer day, I could see my friend but he seemed older and I thought for a second that it was my friends older brother and I had known him as a child and had dragged up some old memory since that feeling of dejavu was overwhelming. I have never been scared or had a ‘bad trip’ I guess it’s that dejavu feeling that smoothes everything over so it feels like your just reliving old memories even though your standing in a garage completely out of your mind.
Gas huffing is bizarre. I really wouldn’t advise anyone to try it. It is fun at the time but after it wears off you taste gasoline with every breath for about two days, and are left in a sub-human funk of depression and lack of motivation. For as fun and strange as it is it’s completely uninformative and unenlightening. I don’t think it’s worth the hangover since it only lasts for about 5 minutes, and your hangover will last for a whole day.
gonna have to start buying Popov instead of Kettel One
The scale on the left side of the graph doesn’t look right. If you spend $100 a month on gas, you would need an annual DPI of $4 million to be spending .03% of it on gas (12 x 100 / 0.0003).
why does the graph only go back to the 1990’s? This seems like one of those “highest gasoline prices ever” things that doesn’t account for inflation.
I slowed down on the highway and my mileage has increased about 50 miles per tank. I drive about 32 miles each way to work and the slow down only costs me an extra 5 to 10 minutes, so it’s worth it. I have a crappy Saturn SL1 and get about 30 mpg combined city/highway. I’ve been researching cars and I really want a diesel because there is a supplier of biodiesel here now and I figure within a year it should hit the pumps, but I really distrust VW’s reliability.
Here in the burg of Glen Head on the North Shore of Long Island I would guess gas needs to get to $4 or $5 per gallon before it affects anyones driving habits.
So far I don’t detect any modification in my familys or any of our friends concerns about the price of gas. Sure, there is the cocktail chatter and the inevitable explanations by the school board about energy prices being the reason for larger increases in school taxes but $3 per gallon does not seem enough to make an impact.
A-
What kind of hedge/mutual fund do you run, so I know to stay away from that…
LOL
j/k
Todd
todd – I’m guessing he’s long on XOM.
I’m much more inclined to fill the boat up at the lake house using gas cans that I run back and forth to the local Mobil station. If you think gas prices on the highway are high, try filling up a 50 gallon tank at a marina ($4).
Ok Ok Ok If everyone is cutting back on gas consumption then who are the jack-asses pushing usage up 1%!?!
I am perplexed. Something isn’t right. A fib is in the offing and when we find out the truth I think we’ll all be pissed.
As I noted, I have yet to adjust my habits — and while a lot of people are bitching anout high prices, we have yet to see a curtailment of consumption, or shift in automotive purchases, or reduction in consumer spending
Oh so it’s YOU! BARRY!
Hey Everyone Barry won’t stop wasting gas!!!!!!
Let’s get him.
We have a Prius, and I live in the downtown area where the speed limit is 35 MPH or less, so I don’t actually use any gas going to work/gym/grocery store. Ha Ha Ha Ha Ha. I fart in all of your general direction.
on the second thought, I’ll just stick to my ethanol/Red Bull blend…
BTW- CNBC was interviewing people at the pump the other day and some guy in a massive Land Rover was bitching (loudly) about gas prices. Give me a break.
I am really starting to believe that $5 gas is right around the corner. Once oil cracked $70 without a hurricane I was sold.
It takes roughly 15years for the US auto fleet to “turnover”. Something to think about when considering conservation though higher mpg vehicles.
Auto sales in asia are starting to climb substantially.
A. you should stick to huffing nitrous. Actually, stick to mother nature’s prepackaged drugs..maryjane and vroom vroom shrooms. Mom knows best.
What is this a pseudo Dead Head reunion?
Todd,
I work for Ritholtz Capital Management. JUST KIDDING.
(BR: He doesn’t work for me — as you might suspect, he failed the drug test . . . )
Seems more like an Allman Brothers Affair than a Jerry Garcia Get Together.
Anyway, the way things are going with the environment (no winter here, but we’re getting a second dose of fall), I’m thinking of joing the ELF. That guy in the Range Rover had better watch out (jk NSA if you’re monitoring this site).
And you hope the NSA understands “jk” lately I wouldn’t put it past any governmental department secret or otherwise not to missinterprate it as “Jihadist Kook.”
I have a 30 minute commute by truck (Ford Ranger 20MPG). 1 hour commute by Bus. Bus is free through work. Driving Costs around $18 a day (gas, Parking, Maintenance). That is about $400 a month. For those of us just starting out in life, thats a third of my mortgage payment. The bus it is, $200 to investments, $200 to living a better life. Those who do not alter thier habits will be hurt the most.
And you hope the NSA understands “jk” lately I wouldn’t put it past any governmental department secret or otherwise not to missinterprate it as “Jihadist Kook.”
I know the disclaimer to the NSA is meant as a humorous one. That said, I suspect there is just a tinge of healthy paranoia in those statements that leads one to post it. At least there is on my end. A little bit of a scary time IMO.
Give me a big bag of ganja and they can do what they want. I can’t wait till they legalize pot. I’m going to drop from society and become a 420 guy. Now THAT is what it means to be a true American!
semper fubar, have your Jetta’s windows fell out yet?
Posted by: jim | May 2, 2006 11:36:49 AM
I know – I’m a little worried about VWs reliability, but so far so good. If every other damn car company in the world hadn’t stopped making wagons in favor of hulking SUVs, maybe I would have had a choice! Not to mention, try finding a diesel….
Maybe with all the money I’m saving on fuel, I’ll be able to afford a few repairs. ;-)
buses or much fuller here, too…the gas prices are changing habits. I bought a hybrid three years ago…it’s pay back time.
Barry: We pay about as much for Regular here as you for Premium there, sir.
Put up a graph which shows the cost of food in the same manner. I don’t have the empirical data, but I did once see a chart which showed that it has decreased by over 40% since the 1950’s.