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More fuel-efficient vehicles are the future. But consumers don't seem very excited. (http://www.portfolio.com/news-markets/top-5/2008/09/25/Fuel-Efficient-Vehicle-Hestitation)

http://www.cleanmpg.com/photos/data/501/EV02.jpgMegan Angelo - Portfolio.com - Sep. 25, 2008

For the auto industry, the future is small.

Automakers have committed themselves to producing smaller, more fuel-efficient cars as gasoline prices remain high. Detroit's Big Three may receive as much as $25 billion in federal loans to help them meet new fuel-efficiency standards.

But the latest CNBC/Portfolio Wealth in America survey found that only 12 percent of Americans were "very likely" to buy a more fuel-efficient vehicle than their current one over the next 12 months. Ten percent said they were "somewhat likely" to do so. And 57 percent said that they were "very unlikely to do so."

"It's surprising, certainly, considering what we've seen all year, especially in the summer," said Itay Michaeli, senior auto analyst with Citigroup. "When gas prices spiked, the small-car segment literally skyrocketed."

Compact vehicles with light petrol-appetites have been a lone bright spot for many automakers over the past several months. Consider Toyota, which in August reported an overall sales drop of 9.4 percent—but a 20 percent increase in sales of the Yaris. Or Ford Motor, which had a 3.6 percent drop in sales, but a 23 percent sales boom for the Focus that month…http://www.portfolio.com/news-markets/top-5/2008/09/25/Fuel-Efficient-Vehicle-Hestitation

They probably should have added "Will you buy a new car at all in the near future?"

They probably should have added "Will you buy a new car at all in the near future?"

Exactly. The way the money is tanking lately, people are just not buying things. I bought my Yaris in January, expecting the floor to fall out of the credit market + get better gas mileage for my 120 mile commute daily. People watching what is happening with the economy are now thinking that they can put off getting into a more fuel efficient car now that the gas prices are dropping.

People watching what is happening with the economy are now thinking that they can put off getting into a more fuel efficient car now that the gas prices are dropping.

That and with the credit tightened up it is impossible to get a loan towards a new fuel efficient car anyway :(

And, I'm sure a lot of folks are worried about just keeping their jobs long enough to pay off that 4-6 year loan.

Well, it all changed overnight. If one listens to CNBC's constant drumbeat of government officials and analysts, the Bush admin has caved into the european view of what must be done on the financial front. Apparently we are now to turn up the printing press and inject "capital," (i.e. new printed money) into everyone's pocket that can be identified. If you were holding dollars as a long position (i.e. if you had savings) those dollars have just been diluted considerably as more and more dollars chase a fairly constant supply of good and services. But, there should be a period of some unknown length when car loans become available. This thing ain't over yet.

History is repeating itself with variations.

In the 1970's, many Americans stopped buying cars from Detroit designed for a life of only 100,000 miles. Over time, American cars had to last longer to compete with Toyota and Honda. Now people are hanging on to cars for financial reasons.

That and with the credit tightened up it is impossible to get a loan towards a new fuel efficient car anyway :(

Just a bit inaccurate, still fairly easy as long as you aren't defaulting on anything and have an average history.