Despite rising cost of a fill-up, Americans still love their SUVs

Some find 14 mpg acceptable to get roominess, ride, safety

August 21, 2005|By Frank D. Roylance and Mariana Minaya | Frank D. Roylance and Mariana Minaya,SUN STAFF

The weekly visit to the gas pump is starting to bite, and bite hard. The fill-up that drivers shrugged off at $25 is suddenly putting a real dent in family budgets at $50 or more.

So, is the pain of $2.70 a gallon enough to end America's love affair with gas-guzzling sport utility vehicles? Not quite yet, industry analysts say. Buyers are beginning to put fuel efficiency higher among their priorities for their next car - but there's no SUV divorce in sight.

"It's not accurate to say SUVs are no longer popular, or are not being sold because of their fuel economy," said Brian Chee, an analyst with Autobytel, one of the most popular Web sites for new car buyers. "Lifestyle and price are still very important, probably more important. Fuel economy is probably No. 3 at this point, where it was 5 or 6."

He might have been talking about Richard Goodale, an adviser at Ameriprise Financial in Owings Mills who thought about mileage but still bought a 14-mpg Toyota Sequoia this year.

"When people need a vehicle, they're going to buy what suits their needs," Goodale said. "I just purchased a big SUV because my family needs one to get everybody to and fro. It's a little bit of a shock to fill your car up for $65, but it's what it takes to do what you have to do."

There's little question that some of the bloom has come off the SUV rose. Surveys by Kelley Blue Book, which tracks car prices and market trends, found that the proportion of buyers looking for SUVs dropped from 40 percent last year to 34 percent in 2005.

Rick Wainschel, Kelley's vice president of marketing research, said fuel economy has eclipsed rollover worries as the main reason buyers turn down SUVs. Shoppers are also worried about U.S. dependence on foreign oil. "I think the love affair is over," he said. But, "I think the need for them [SUVs] still exists."

Crossovers popular

That ambiguity shows up in Autobytel's tracking of purchase requests to local dealers that visitors make through the firm's Web site.

"We're seeing a clear shift within the SUV segment toward smaller, crossover SUVs with better fuel economy numbers, and a shift toward minivans and away from less fuel-efficient SUVs that get less than 18 miles per gallon," Chee said.

The site's car buyers are also increasingly interested in fuel-efficient passenger cars, either as replacements for gas hogs or perhaps as third cars. And, although he doesn't have the data to prove it, Chee has a theory he calls the "exurb factor," based on the growth of communities that sprawl far beyond traditional suburbs.

"As the exurbs grow, people are sitting in jams for longer and burning a lot of gas," he said. "People are saying, `The wear and tear on the SUV is killing me.'" As a result, many appear to be buying inexpensive, gas-sipping commuter cars to use during the week, leaving the SUV in the garage until the weekend.

Autobytel concedes that its customers are more fuel-obsessed than other car buyers. But in a general survey of 1,016 adults this summer by Scripps Survey Research Center at Ohio University, 41 percent said gas prices were affecting them "a great deal."

Fifty-six percent said high pump prices would make them consider a more gas-efficient car next time they buy, while 37 percent said they wouldn't.

Some motorists, of course, need big cars and SUVs to haul supplies and truck the kids off to college or the team to soccer practice.

And big cars did fly out of showrooms this summer, spurred in part by thousands of dollars in discounts on trucks and SUVs. Industry reports say U.S. automakers sold more than 1.8 million vehicles in July, up by 100,000 from the previous record, set in August 2002.

SUV sales by the big three U.S. automakers rose 31 percent in July. Sales of the 14-mpg Jeep Grand Cherokee jumped 85 percent in June and 78 percent in July over the previous year.

"It's not like people are dropping out of the market like crazy," said Kelley's Wainschel.

Some buyers just want the big, high ride and the sense of safety that an SUV affords. And many can surely pay the price.

"If you can afford a $60,000 vehicle, you can afford to put the gas in it," said Laura Siltman, who sells Buicks, Pontiacs and GMC trucks at Anderson of Hunt Valley. In the past two weeks, five of the eight cars she sold were SUVs.

Goodale, the financial adviser, said buyers don't limit their calculations to the pump price. For example, with gas prices up, dealers are slashing prices on big vehicles, offering upfront discounts that will cover years of potential savings from greater fuel efficiency.

Pay now, pay later

Kim Marcantoni of Bel Air was shopping last week at the CarMax lot in White Marsh with her husband, Jule. Both are in their 40s. The wife said she considered buying a more fuel-efficient car, but her husband objected because of the savings available on bigger cars.

"It takes a long time to make up the dollar difference in gas price," he said.

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