Americans have pumped less gas every week for the past year. During those 52 weeks, gasoline consumption dropped by 4.2 billion gallons, or 3 percent, according to MasterCard Spending Pulse. The decline is longer than a 51-week slide during the recession. The main reason: higher gas prices. The national average for a gallon of gas is $3.89, the highest ever for this time of year, and experts say it could be $4.25 by late April. As a result, Americans are taking fewer trips to restaurants and shopping malls.
When they take a vacation, they’re staying closer to home.
But the decline in gas consumption is also a sign that efforts to push carmakers to produce vehicles with better gas mileage are paying off. The average new car now gets nearly 24 miles to the gallon, compared with about 20 mpg just four years ago, according to the University of Michigan Transportation Research
Institute. “I’d expect to see lower gasoline consumption for several years to come,” Rice University energy
expert Ken Medlock says. Americans have cut back on fill-ups for extended periods before. In 2008, gas spiked from $3.04 to $4.11 per gallon in seven months. It wasn’t until January 2009, when the national average for gas had dropped to $1.86 that consumption increased.
Drivers bought more gasoline for 23 weeks in a row. “The spike in 2008 was a real shock to the system,” Medlock says. “There’s still a residual impact on people’s driving behavior.” There were other stretches of reduced gas use, notably two into the 1970’s and one in the early 1980’s. But in those cases, Americans eventually went back to driving big cars and trucks that guzzled gas.
This time may be different. Medlock thinks economic growth will be too modest and gas prices will stay too high for Americans to start driving more anytime soon. Economists expect the U.S. economy to grow 2.5 percent in 2012. The government estimates that gas will average a record $3.79 per gallon for the year.
John Gamel, who oversees MasterCard Spending Pulse’s weekly consumption report, points to rising sales of fuel-efficient vehicles. “People have gotten used to elevated prices and they’ve made their long term
purchases,” Gamel says. “They’re going to be using less fuel.”
Consumers now care more if a car gets good gas mileage than if it’s reliable, stylish or comes with a great deal, according to a survey of more than 24,000 new-vehicle owners taken last summer and fall by J.D. Power and Associates. That wasn’t the case in the nine previous years that J.D. Power conducted the
survey. Automakers have listened to consumers, and responded to stricter government fuel economy
requirements. They’ve improved engines and transmissions so cars burn less fuel. They’ve also made cars more aerodynamic, boosting mileage by cutting wind drag.
The government is gradually increasing gas mileage requirements so that by 2025, cars and trucks will
have to average 54.5 mpg. Between February 2011 and February 2012, the combined city-highway mileage of a new vehicle sold in the U.S rose to 23.7 mpg from 22.7. Better gas mileage has a huge impact on the overall economy. At $3.86 per gallon, U.S. drivers would save $35.8 billion per year with a 1 mpg improvement for the entire fleet of cars, trucks and buses, according to Michael Sivak, a research professor with the University of Michigan Transportation Research Institute.
Consumers would appreciate the help. The rise in gas prices has been so steep that they’re still spending more on gas than a year ago despite using less. Gasoline prices rose by 24 percent in the last 52 weeks, according to auto club AAA, Wright Express and Oil Price Information Service. MasterCard, which collects purchase receipts from more than 100,000 service stations around the country, said spending on gas rose by 20 percent during that period.
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