Sunday, September 19, 2004

Gasoline and the American People: A CERA Special Report

This a an old Report from CERA, however it is very much worth reading:
How efficient? For decades, gasoline in America was relatively cheap, and supplies of crude oil for making gasoline were more than abundant. Neither motorists nor government worried much about fuel efficiency. The situation changed with the First Oil Shock of 1973-74. Legislation enacted in 1975 established CAFE -- the Corporate Average Fuel Economy standard. The fuel efficiency of new car fleets was to double from the average 13.4 miles per gallon of 1973 to 27.5 miles per gallon by 1985. This was achieved. Since then, improvements in fuel efficiency have plateaued, as Americans have opted for higher performance -- and for minivans, light trucks, and Sports Utility Vehicles. Indeed, what started off as an infatuation has turned into a long-running love affair. The difference is striking. The average new car gets about 27.5 miles per gallon. The average light truck/minivan/SUV gets only 21 miles per gallon. (These are EPA-rated theoretical fuel efficiencies-in actual on-road driving fuel efficiency effectively drops by about 15 percent.)

...How much? Americans drive more and more. In 1980, the average licensed driver traveled 9,700 miles. In 1998, 18 years later, they were driving over 13,000 -- an increase of 34 percent. The number of licensed drivers is now over 185 million. But there are still more registered light duty vehicles -- 203 million -- meaning that, on average, each licensed driver has 1.1 vehicles. A big source of new drivers -- and more gasoline consumption and miles traveled commuting -- has been the entry of a significant number of women into the labor force. Now that the rate of women entering the workforce has slowed and vehicle ownership has exceed saturation, that suggests that the increase in the number of miles driven will flatten out. Another major new factor is the astonishing growth in the driver population over age 65, which has increased from 15.5 million in 1980 to 26.2 million in 1998. Their numbers are increasing, but the mileage that they put on goes down, not up.

Is gasoline the second lifeline?


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