American Gas Boom

NHTSA (the U.S. National Highway Traffic Safety Administration) has proven itself adept at promoting the new fuel standards imposed by the Obama Administration. Tapping the widespread obsession on gas prices, they claim that upgrading to the new sedans and trucks would be equivalent to paying a dollar a gallon less for your gas, but that may change with a gas boom.

The strongest argument made for the new fuel standards was not about emissions, or reducing oil use by 6 billion tons, but about saving money at the pump. Consumers being able to save roughly $8,000 on the cost of fuel during the lifetime of the vehicle was a huge selling point on making these vehicles the standard.

Closing Opportunities from Gas Booms

It seems that in the U.S. the window of opportunity to convince consumers of the need to replace their vehicles with more economical ones is closing. If the reports of the U.S. supply of its own home-brewed fossil fuels are true, America could become the largest oil producing nation in the world. With the ability to produce its own fuel the U.S. could wean itself off or foreign oil within the next ten years, and also cut gas prices significantly.

With the possibility of gas prices dropping, due to a gas boom, and the U.S. possibly having its own source of oil, miles per gallon could be set back on the list of consumer needs when shopping for a vehicle.

Loss of Fear

With the possibility of America having its own fuel source the fear driven desire for eco-friendly vehicles could come to a standstill. Without that fear, many consumers won’t want to give up their trucks, SUV’s, or sports cars for a “cute little electric car”. With a possible gas boom on the way hybrid and electric car manufacturers could face difficulties on those lines of vehicles.

With the fear of oil shortages and price hikes gone, there won’t be the same drive to produce more fuel efficient cars – as well as the drive to buy them. The government mandates may be repealed, and the oil crisis knocked back another 40 years.

The Future

What will the future of economic vehicles be? The cost of fuel for the U.S. and Canada reflect the sales of hybrid vehicles, which could say a lot for future sales. Selling vehicles for the environments benefit, without the worry of expensive fuel, could prove to be troublesome. With the cost of gas staying the same, or even dropping, the sales rates for hybrids would suffer significantly.

Studies show that hybrid sales have direct correlation to the price of gas, which can change drastically with a gas boom – like the one that is expected to hit if there really is an American oil pocket found. Even with constant complaints about fuel economy, purchase patterns for economy and hybrid vehicles only rise when there are severe rises in gas price.

( Chief Strategy Officer (CSO) at SYCN Auto Logistics-Alchemist, blending the best technology, analytics & service available. )

Senior automotive logistics professional with a passion for the industry and a 10+ year history of accomplishments. Proven track record of exemplary client management working with both RMCs, Van Lines and OEMs. Keen ability to react to an ever-changing marketplace while offering superior technology solutions, programs and services. Architect of award winning auto transport portal technology offering transparency and agility to clients, agents and transferees. Successful team builder and leader easily managing budgets with effective leadership, strategic planning, and problem-solving capabilities.

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