High Gas Prices Fuel Consumers to Change Driving and Purchasing Behavior

Maritz' Surveys Reveal Gas Price Thresholds

TOLEDO, Ohio, Oct. 13 -- A series of surveys by Maritz Research's Automotive Research Group (ARG) has revealed that hikes in gas prices are impacting all aspects of consumers' behavior as it relates to their vehicles, including changing driving habits and vehicle purchase/maintenance decisions.

In relation to the increase in gas prices over the past year, significantly more people said they are reducing unnecessary driving (79 percent in 2005, compared to 65 percent in 2004), not going on long trips or vacations (52 percent in 2005 to 39 percent in 2004) and driving more conservatively (73 percent in 2005 to 63 percent in 2004) this year, compared to 2004.

Consumers surveyed were consciously making behavioral adjustments in reaction to higher gas prices such as taking steps to increase fuel efficiency. For example, roughly three out of four consumers surveyed in 2005 stated they would make sure their vehicle was in the best working order, which could lead to a boost to the service and repair industry.

Furthermore, in a recent Maritz Poll(R) survey, two-thirds of the respondents said that gas prices have had an effect on the size of vehicle they think about buying. Nearly half (45 percent) agreed with the statement, "I think about buying or have bought a smaller vehicle."

As far as new sales go, the Maritz New Vehicle Customer Study, a nationally representative study of new automobile buyers and lessees, showed that trucks still made up over 50 percent of new sales, although the trend was moving toward smaller vehicles within a purchase class (i.e. from a large SUV to a medium SUV, from a medium SUV to a small SUV) rather than a major shift to cars. Regarding vehicle consideration, the segments predicted to suffer the largest losses were full-sized vans, full-sized pickups and medium-sized cars. The winners were small SUVs and compact pickup trucks.

"Interestingly, now that gas prices are spiking up to $3 and beyond, as opposed to the gradual increases of last year and earlier this year, a recent trend has some Americans ending their SUV love affairs," said David Ensing, Ph.D., director, Research and Development for Maritz' Automotive Research Group. "However, as the initial shock of the highest gas prices in many consumers' lifetimes wears off, I suspect we could see small SUVs and light pickup trucks win the popularity race."

Remember the Good Ol' Days When Gas Was $1.57?

The New Vehicle Customer Study was conducted when the reported last price paid for a gallon of gasoline was $2.15 (consistent with the U.S. average price). This price was considered well above an "acceptable" price of $1.57, which is close to the government-tracked price of almost two years ago (January 2004).

The Maritz surveys also reveal what price points would determine changes in driving habits and vehicle choices. According to Ensing, "The breaking point at which those surveyed said they would begin changing their buying and driving habits is upon us."

The auto industry, particularly manufacturers, will be closely watching buying trends this fall to determine their next moves:

  --  Over 94 percent of consumers stated an intention to drive less when
      gas prices reach $2.76 per gallon;
  --  85 percent stated they would think about purchasing a more
      fuel-efficient vehicle at $2.75 per gallon; and
  --  93 percent would shop for a more fuel-efficient vehicle as soon as
      possible at $3.22 per gallon.

  Hybrids Are Hot, But Diesels Are Not

While hybrids continue to be hot, diesel engine vehicles have not been met with much enthusiasm despite the attention a new generation of "clean diesel" vehicles has garnered as an alternative to gasoline. In fact, a whopping 59 percent of respondents said they would not consider buying a diesel vehicle. Maritz also asked about the appeal of various other powertrain types and, while 27 percent did not state a preference, hybrids were mentioned the most (24 percent) followed by fuel cells (12 percent). Gas blends (10 percent) and diesel (7 percent) were the next most appealing choices for alternatives to gasoline in the minds of consumers. These responses reflect U.S. views on diesel fuel, which are vastly different than the rest of the world, indicating diesel is not a key option for any short-term relief for gasoline volume concerns.

Consumers are more interested in hybrids, fuel cells and gasoline options, such as ethanol, as choices for managing gasoline costs at the household level. Recently diesel prices have risen alongside gasoline prices, further limiting its viability as an option.

Survey Information

Maritz' Automotive Research Group conducted three surveys examining the effect gas prices have on the way Americans are using their vehicles and the vehicles they are considering for purchase. In August 2005, 1,009 adult owners and drivers of vehicles were surveyed in an online Maritz Poll(R). The results were compared to a similar Maritz Poll of 1,014 adult owners and drivers of vehicles conducted in August 2004. Also, in a separate February 2005 study, 39,000 consumers who had purchased new cars in the past 90 days responded to questions regarding their perceptions of gasoline prices. The U.S. average price for regular gasoline in August 2004 and 2005, respectively, was $1.85 per gallon and $2.58 per gallon.

About Maritz Poll(R)

Maritz Poll(R) is a copyrighted poll conducted since 1988 by Maritz Research Inc. Maritz Poll(R) comprises regular surveys on topics related to the automotive, financial services, hospitality, retail, technology, and telecommunications sectors as well as workplace issues. Sampling error for the overall poll is +/-3 percent. Results of the poll may be used in print or broadcast media, provided credit is given to the Maritz Poll and/or Maritz Research. For more information, visit http://www.maritzpoll.com/ or call 1-877-4MARITZ.

About Maritz' Automotive Research Group

Maritz' Automotive Research Group (ARG) is one of the world's leading providers of automotive research. Based in Toledo, Ohio, the group also has offices in Detroit, Los Angeles, Toronto, Hamburg, and London. Maritz currently conducts customer satisfaction programs that cover 70 percent of the new cars and light trucks sold in the United States. In support of these programs, Maritz conducts more than 1 million telephone interviews and mails more than 40 million questionnaires each year. Over 17,000 North American and European automotive dealers have access to their customer satisfaction and other research results on Web sites created and managed by Maritz.

About Maritz Research

As one of the world's largest marketing research firms, Maritz Research, a unit of Maritz Inc., helps many of today's most successful companies improve performance through a deep understanding of their customers, employees and channel partners. Founded in 1973, it offers a range of strategic and tactical solutions concentrating primarily in the automotive, financial services, hospitality, telecommunications, retail, workplace and technology industries. The company has achieved ISO 9001 registration, the international symbol of quality. It is a member of CASRO and official sponsor of the American Marketing Association. Based in St. Louis, Maritz Inc. provides market and customer research, communications, learning solutions, incentive initiatives, meetings and event management, rewards and recognition, travel management services, and customer loyalty programs. Maritz has a presence in 42 countries, with key offices in the United States, Canada, the United Kingdom, France, Germany, and Spain. For more information, visit http://www.maritz.com/ .