Gas prices have hit a record high, not adjusted for inflation, which has sparked increased demand for electric cars, hybrids and smaller gasoline-powered vehicles. But shoppers may not find much to choose from.
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Gas prices have hit a record high, not adjusted for inflation, which has sparked increased demand for electric cars, hybrids and smaller gasoline-powered vehicles. But shoppers may not find much to choose from.
Joe Raedle/Getty Images
With gasoline prices topping $4 a gallon, many drivers are looking for a car that will go farther on a gallon of gas, or maybe one that doesn’t use gasoline at all.
Finding such a car, though, is not easy.
Electric cars and gas-electric hybrids are in short supply, and prices have been climbing rapidly. Smaller gasoline-powered cars are also scarce, as automakers have focused on building more lucrative pickup trucks and SUVs.
Take Lori Silvia, a landscape designer in Middletown, R.I., who’s looking to replace her 2008 Ford Explorer.
She’d like a vehicle that gets better gas mileage but that can also accommodate her gardening tools, her dog and her stand-up paddleboard.
“I just like the feeling of something big and heavy,” Silvia says. “I come from a family of small women, and we’ve all driven enormous cars.”
But as of now, she’s out of luck.
“I would love a hybrid SUV someday,” Silvia says. “But right now, I don’t feel like I can afford it.”
America’s love affair with SUVs and pickup trucks
SUVs and pickup trucks accounted for more than three out of four vehicles sold in the U.S. last year.
But consumers have become more mindful about fuel economy now that gasoline prices have surged to a record high, not adjusted for inflation.
Compact, gasoline-powered cars are typically less expensive and get better gas mileage, but supplies are tight.
That’s because carmakers have prioritized building larger, more profitable vehicles as they have struggled with a shortage of semiconductors.
“If you’re General Motors, you’d rather make a big SUV,” says Pat Ryan, CEO of the car-buying app CoPilot. “A big Suburban might make you $10,000. There’s no way to make $10,000 on a $25,000 car.”
Ford’s all-electric F-150 Lightning is displayed at the Los Angeles Auto Show on Nov. 18. Automakers are unveiling electric models of their most popular cars as they seek to take advantage of rising interest in electric vehicles.
Frederic J. Brown/AFP via Getty Images
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Ford’s all-electric F-150 Lightning is displayed at the Los Angeles Auto Show on Nov. 18. Automakers are unveiling electric models of their most popular cars as they seek to take advantage of rising interest in electric vehicles.
Frederic J. Brown/AFP via Getty Images
Dealers say they are still seeing strong sales of SUVs and pickup trucks, although they are on the lookout for any big shift in consumer demand.
“In previous times, when gas [prices] spiked, people reacted quickly,” says Pete Swenson, senior vice president at Walser Automotive Group, which runs a string of dealerships in Minnesota, Kansas and Illinois.
“And then when gas went back down, it seems like they switched back,” Swenson adds.
But interest in electric cars is rising
Americans are also increasingly looking at the option of going electric.
Zoe Wise, for example, is giving more weight to her husband’s desire for an electric car, now that they’re paying $4.59 for gasoline in Anchorage, Alaska.
“I always thought that’s a little bit of a luxury. I don’t know if that’s something we need to get,” Wise says about electric cars. “But now we’re looking at it a little bit more seriously.”
The couple is currently sharing a single subcompact car: a 2008 Toyota Matrix.
Wise is encouraged that the state of Alaska is planning to build a string of vehicle-charging stations on the highway linking Anchorage with Fairbanks.
But finding an electric vehicle is also tough, despite the rising interest.
Electric vehicles only make up just over 4% of U.S. sales at the moment, even as automakers are racing to produce electric versions of their current models or are introducing new ones.
The upfront cost of electric vehicles is also high.
Surging demand has pushed the price of used Teslas to $63,000 — a jump of $1,700 in a single week, according to data from the CoPilot app.
“There’s a ton of demand in the market, but there just isn’t the supply,” says Ryan, the CoPilot CEO.
Used SUVs, on the other hand, have dropped in price by an average of $862 over the last month.
A Tesla car recharges at the Tesla Supercharger station in Petaluma, Calif., on March 9. Prices of used Teslas have surged because of a lack of new cars.
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A Tesla car recharges at the Tesla Supercharger station in Petaluma, Calif., on March 9. Prices of used Teslas have surged because of a lack of new cars.
Justin Sullivan/Getty Images
You can still buy an electric car
Still, it’s possible to get an electric vehicle. It just requires some patience.
When Marlene Dempster’s Audi died last month, she went looking for a replacement, without much success.
“It was so frustrating,” Dempster says of the limited inventory of new cars. “I turned to try to find a used one, and that was even worse. Almost $50,000 for a three-year-old car? The used market is absolutely off the charts right now.”
Then her neighbor got a new Tesla. Dempster took one drive in it and immediately ordered her own electric vehicle.
“Oh, it’s amazing what those cars can do,” Dempster says with a laugh. “The torque is amazing. And I just feel really good about not using petroleum.”
Dempster felt even better a few weeks later, when the price of gasoline in Ventura, Calif., where she lives, soared to nearly $6 a gallon.
“Since I ordered my Tesla, the down payment has doubled and the price has gone up several thousand dollars,” Dempster says.
She’s not driving it yet though: She expects to take delivery of the car in about two months.
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