Over the last month, auto analysts say, consumers have shown a fresh interest in the kind of SUVs — Hummers, Lincoln Navigators, Ford Explorers — that typified America’s bigger-is-better mindset of twenty years ago. The new mindset among some car buyers is one of the most unexpected consequences of a domestic oil boom that has helped cause global crude prices to plummet in recent months, with the cost of a gallon of gas now below $3.
As oil prices hit a three-year low, Americans are starting to see price changes that could ultimately influence everything from their grocery shopping to their heating bills to their travel. The lower prices — should they be sustained, as expected, for the next few months — have the potential to nudge the U.S. further away from its dreary post-recession mindset, leaving instead a nation with more affordable air and road transportation options, higher consumer confidence, and yes, a few more gas guzzlers driving around…
One measure is the share of “trucks” — including pick-ups, SUVs and crossovers — among total vehicles sold. Before the financial crisis, trucks almost always outsold cars, in some months grabbing as much as 59 percent of the market. Post-recession, the industry has flip-flopped; cars are more popular.
But not in recent months. In September, the truck market share was 53.5 percent. In October, it was 53.6. That is the best sustained two-month stretch since 2005.
As for those Hummers? Autotrader.com said interest in Hummer H1s on its site rose 11 percent last month, making it the fastest-growing older model among all vehicles.
As gas prices drop, Americans are returning to some of their consumption patterns from the late 1990s and early 2000s when the economy was doing better. Even though they have seen higher gas prices (which could return soon), gone through a great recession, and government regulations encourage more MPGs across all vehicles in the coming years, some Americans want bigger vehicles that require more gas.
This is interesting in itself but I wonder if the same general concept could apply to McMansions. One argument about reducing purchases of SUVs and McMansions, often paired symbols of excessive consumption, is that Americans needed to be shocked by high gas prices and hard economic times before they would change their behavior. Yet, the recent data about gas prices suggests Americans might just return to their spending patterns once things look better. (And, with the gas prices, it is not like they are likely returning to the $1.20-$2.00 range of not that long ago.) Might the same apply to McMansions? Even with all the fanfare about smaller homes, more reasonable debt loads (whether through mortgages or car loans), and critiques of the kind of sprawling communities in which communities are often built, will Americans return to McMansions once the economy picks up?
I, for one, wouldn’t be surprised. Even during the recession, people with money continued to purchase and build large homes. Homes do require a larger financial commitment than SUVs but they also are highly symbolic and linked to suburbs, all dealing with the American Dream. Perhaps the best hope for fighting these consumerist impulses is pervasive generational shifts, particularly kids, teenagers, and young adults who don’t want cars and suburban houses in the same way over time.