Tipping Point at $13-a-Gallon Gas?

Yesterday in a meeting of the Society of Automotive Analysts — no, we didn’t know such a society existed either — a Chrysler-employed economist suggested that the only way consumers would move en masse to vehicles that averaged 35 mpg was if gas cost $13 a gallon.

The exaggerated — heck, we’ll just say nuts-o — illusion was in reference to a new federal mandate that was recently passed into law to get fleet fuel economy to 35 mpg by 2020. Let’s face it: $13 gas? We better all be driving hydrogen plug-ins with solar panels by then, or the entire industry will be dead. If there were more good cars out there TODAY that averaged 35 mpg we think people would buy them, but current economy cars don’t quite hit the mark — yet they still saw a huge sales increase in 2007.

Still, his point is well-taken: Will consumers really want high-efficiency autos across the board by 2020 if it means they’ll no longer be able to buy vehicles (like large boat-towing SUVs) they would have otherwise wanted? As long as gas costs $3 a gallon, plenty of drivers are clearly still choosing SUVs, even though 2007 sales gains did lean toward smaller subcompacts like the Toyota Yaris and compact SUVs like the Honda CR-V.

Will demand rise for 35-mpg autos? (The Detroit News)