High Oil Prices Can't Slow European SUV Sales

[hatrack]

Energy Compass, 27 August 2004 - "High pump prices aren't deterring European motorists from buying gas-guzzling sport utility vehicles (SUVs). Far from it. Regional sales of SUVs are expected to top 1 million next year, according to automotive experts JD Power-LMC, which forecasts that, if growth goes unchecked, more than 10% of all European new car sales will be SUVs before the end of the decade.

SUVs were previously regarded as an American phenomenon, their popularity fueled by dirt-cheap gasoline. Despite the far higher costs of filling up in Europe -- at an average $5.22 per gallon on Aug. 23, gasoline is nearly three times more expensive than in the US, and diesel over double the price -- the trend has spread through a combination of vehicle efficiency, fashion, affluence and cheap credit. Even so, SUVs will account for less than 6% of new car sales in Europethis year, compared with more than half in the US.

Edinburgh-based oil consultants Wood Mackenzie believes that European car buyers have become less sensitive to fuel economy following years of dramatic improvements in engine technology. According to downstream analyst John Waterlow, greater engine efficiencies have allowed the introduction of new features that add to vehicle weight and size, but have yet to negate overall fuel savings.

"SUVs are part of that ," Waterlow tells Energy Compass. "We're still seeing some growth in private demand for transport fuels when we ought to be seeing non-commercial demand falling overall," he says. Europehas seen steady growth in diesel demand but a drop-off in gasoline buying as motorists have switched from gasoline to more-efficient diesel models over the last few years (EC Mar.12,p3). SUVs are meanwhile held responsible for this year's 2% growth in USgasoline demand."

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This just in - human beings now officially too stupid to survive.

[phantom power]

1. vehicle efficiency, my ass.

I'll buy fashion, affluence and cheap credit.

Of course, if you consider that they're talking about 6% of car sales, that puts it in some perspective. If gasoline cost %5.22/gallon in the US, I bet it would be a lot closer to 6% than 50%.

[Kellanved]

2. action is being considered

http://www.expatica.com/source/site_article.asp?subchannel_id=26&story_id=11849&name=European+politicians+target+SUVs
Anyway, the SUVs tend to be a little smaller than stateside. The term includes cars like the Cayenne and the Touareq. Not that I can understand the phenomenon either way.

[Gir Draxon]

3. wtf

What the hell could Europeans possibly do with an SUV? Aren't their streets absurdly narrow compared to ours in North America? Seems to me that big huge vehicles just won't fit!