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Average Fuel Economy Ticks Up Again In August: Coincidence?

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Fuel economy of new vehicles, October 2007 - August 2012 (from UMTRI)

Fuel economy of new vehicles, October 2007 - August 2012 (from UMTRI)

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Earlier this year, the average fuel economy of new cars sold in America hit a record high of 24.1 mpg. That was in March, when many analysts though that gas prices were preparing to cross the $5-per-gallon mark.

Then, gas prices relented. Oil values plummeted. The rhetoric around Iran and the Strait of Hormuz ratcheted down. And demand in Europe shrank, leaving America with more fuel on its hands. U.S. pumps returned to prices in the $3.60-per-gallon range, and drivers breathed sighs of relief.

But slowly, over the past few weeks, prices have edged up again. In fact, during the past 30 days, we've gone from an average of $3.65 per gallon to the current $3.82. 

Why? Some credit the recovering economy, which has led to increased demand for gas. Others point to summer travel, which has also put a strain on supply. And more than a few nod toward Hurricane Isaac, which shut down oil production in the Gulf of Mexico, sending high-strung speculators into a tizzy.

All we know for sure is that as gas prices have risen, so has the average fuel economy of cars sold in the U.S.

According to the University of Michigan's Transportation Research Institute, average fuel economy hit 23.8 mpg in August, after hovering at 23.6 mpg in June and July. And it's up considerably from the 20.1 mpg that TRI found when it first began tracking fuel economy in October 2007.

Those differences may not look dramatic, but the correlation seems clear and sensible: average fuel economy rises and falls in direct relation to fuel prices. That doesn't mean that there aren't gas-guzzlers sitting on dealers' lots, but they're not moving nearly as quickly as their fuel-efficient cousins.

What does it mean for you, the auto shopper? Most importantly, you can expect to pay a premium for fuel-efficient rides. For new cars, this generally means that dealers are handing out fewer incentives for vehicles like the Toyota Prius. For used cars, it means that gas-sippers depreciate more slowly, narrowing the gap between new- and used-car prices.

Are you shopping for a car? And if so, is fuel economy your top criteria, as it seems to be for most Americans? Drop us a line, or leave a note in the comments below.

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Comments (5)
  1. 23.8 MPG is really pathetic, if you think about it. Cars in the 80s did better than that with much less sophisticated engines and transmissions. Cars (and especially pickup trucks) have gotten so bloated and heavy. Look at the F-150 pickup today compared to the F-150 from the early 80s. Today’s pickup is HUGE compared to that truck--and fuel mileage has suffered on ALL vehicle types as a result. Thankfully (and you have to give credit to the current administration on this one) cars and trucks are seeing significant gains and will continue to improve. Unless the Republicans win and they turn the government over to the oil industry again. Yep, I said it.
     
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  2. If the current administration really cared then why has he Never said anything about the Chevron patent suppression? He just tried to use it to get into office! That alone would of saved tons and tons of gas- but, nope because he caved to the unions & auto industry by bailing them out so they'll slowly as possible continue to create slightly more efficient vehicles so they'll always be able to sell more and more in the future. It's what he calls 'job creation' vs real change.
     
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  3. use it* as in the 'I'm green'
     
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  4. Economy in the Western world is one that happens because of the use of fuel, not in spite the use of fuel. One indicator of how economy goes is the stock market. I have observed that gas prices "play" with the futures among other things or excuses to raise the price. This is: you see gas prices going up tonight, and then you see the Dow Index going up a few points next morning. On the other hand, when you see the stock market going up two or three days in a row, you should expect a gas price raise the next day(s). Furthermore, a sudden 100 point plummet in the Dow Index is followed by a gas price going down a few cents. Why does it happen that way? I don't know, I guess whoever controls gas prices also controls the production distribution
     
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  5. (cont.),marketing and everything about the commodity . The only things that can regulate gas prices are offer and demand. In spite of all sorts of opposing propaganda efforts and other stuff, hybrid technologies and other alternatives are beginning to slowly but surely to offset the balance and lower the demand for gas, and that's the future boy! The higher the gas price today the higher the input of alternatives in a close future, and nobody can't stop that.
     
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