At $4 A Gallon, Everybody Gets Rational

[jeffrey]

So now we know: The price point is $4.

At $3 a gallon, Americans just grin and bear it, suck it up and, while complaining profusely, keep driving like crazy. At $4, it is a world transformed. Americans become rational creatures. Mass transit ridership is at a 50-year high. Driving is down 4 percent. (Any U.S. decline is something close to a miracle.) Hybrids and compacts are flying off the lots. SUV sales are in free fall.

The wholesale flight from gas guzzlers is stunning in its swiftness, but utterly predictable. Everything has a price point. Remember that "love affair" with SUVs? Love, it seems, has its price too...

washingtonpost.com

[MonkeyMama]

No kidding.

I didn't see mentioned (though I admit I skimmed), but government gave SIGNIFICANT tax breaks for businesses that bought SUVs in the mid-2000s. This certainly fueled the boom at a time people might have thought twice.

We had a large chunk of tax clients go out and buy the Big SUVs (had to be over 6000 lbs for big tax break), merely for a one-person commute. These people would have been quite happy with a hybrid. I can assure you our clientele would have bought hybrids if the incentive was there. They actually tend to be rather frugal. It made me sick to do tax returns that one year in particular. That the government was rewarding this nonsense.

They were buying them for on average $35k and selling them this last year for about $10k.

Ouch!