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Friday, June 20, 2008
Low gas prices = SUV boom in Mexico
Do high gas prices change consumer behavior? A comparison of American and Mexican car buying trends seem to give a resounding yes to that theory.
In the U.S., where gas has topped $4 a gallon, SUV sales have dropped dramatically (pickup sales fell 36 percent and large SUVs fell 42 percent in May, according to Bloomberg). Meanwhile in Mexico, where subsidized gasoline costs about $2.70 a gallon for regular unleaded, sales are spiking. SUV sales have jumped about 5 percent in the first months of the year, while sales of practical, high gas mileage compact cars fell 2.5 percent.
“The gasoline subsidy is benefitting high (gas) consumption autos and that’s why we aren’t seeing demand behaving the same way as in the United States,” Jose Gomez Baez, president of the Mexican Association of Automobile Distributors told El Universal.
