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Big Wheels Keep on Turning

A gas price hike is nothing to Angelenos--some may try public transit, but most stay in the driver's seat.

March 10, 2000|MARY McNAMARA and JOSE CARDENAS | TIMES STAFF WRITERS

There may be grumbling at the gasoline pumps, but it takes a lot more than $1.60 a gallon to make Angelenos change their ways. Last week's 11.5-cent increase, coupled with alarming predictions of a $2-a-gallon summer, is causing some drivers to shop around for lower-priced stations, but experts don't expect a stampede toward mass transit, a fire sale on SUVs or even an increase in carpool-lane traffic any time soon.

"Our research shows that at less than $2 a gallon, people do nothing to modify their behavior," said Jim Hossack of AutoPacific, an auto industry analyst firm in Tustin. "If prices go over $2 and stay there, then you might see them combining trips to the grocery store and the dry cleaners. But prices would have to hit $2.50, $3 before they start affecting trends."

So say the analysts. But not everyone at the pumps is taking it in stride.

"I think it's outrageous, but it's the law of supply and demand," said Christie Edinger, who actually walked to a Chevron in Burbank to pick up a snack. "I have a car--it's a gas hog. I use it for road trips. That's it."

Despite the recent increase, Hossack said, American fuel prices remain relatively and historically low--only a few countries, including Saudi Arabia, Nigeria and Venezuela, have lower prices at the pump, while most Europeans pay double or triple what we do to fill their tanks. So those hoping that high prices might spark a renewed participation in energy conservation or sound the death knell for the sport utility vehicle are in for a big disappointment. "Consumer confidence is high," said Hossack. "The economy is good; we are a long way from a fuel price that would make small cars attractive again."

And there are signs of relief ahead. Oil prices took a steep dive on commodity markets this week, a reaction to signals that OPEC nations are about to ease their grip on production. Gasoline prices also dropped, although analysts say it may still be months before consumers see relief.

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At the pumps around the L.A. area, sales remain constant or even slightly increased, thanks to people buying now out of fear of rising prices. But some customers are making plans to curtail their driving.

"I'm not going to lie, [the price] is affecting me. And I hear it's going to be $2 by the summer," said Christina Villalobos as she filled her minivan tank at an Alhambra Mobil station. "Instead of going shopping, now I'm having things sent by mail. They'll ship things for $5 and it's cheaper to do that than [pay for] gas."

Some customers are also using the time-honored penny-pinching solutions of forgoing premium gas, pumping it themselves and shopping around.

Ara Simonian, manager of the Mobil station on Atlantic Boulevard where Villalobos was a customer, said sales of regular--at about $1.55 a gallon--have jumped from 50% to 70% of the station's total in just two weeks. And some customers who usually fill their tanks lately have been buying just enough to get them to a station where the gas may be 4 or 5 cents cheaper.

"I'm in the process of curtailing my driving because I think the prices are atrocious," said Evelyn Wall, pumping slightly less than $4 worth of gasoline, which she estimated would get her vehicle to a less-expensive station.

Long-distance commuters are also proving themselves amenable to trying something new when gas prices rise. Metrolink ridership has increased 6% to 7% in the past few weeks to about 32,000 a day. While the recent rain is probably the primary cause, said Metrolink spokesman Peter Hidalgo, some of those new passengers are reacting to gas prices. "When gas prices hit a similar peak in 1997," Hidalgo said, "we saw a 10% to 12% increase that we were comfortable attributing to the high prices."

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The average commute for a Metrolink commuter is 34 miles one way, he said, compared with the 16-mile county average, so it makes sense that riders would feel the effects more swiftly and strongly. An informal survey in 1997 by Metrolink showed that when prices reached $1.75 to $2, commuters were more willing to at least try the train.

The ridership swell in '97 lasted about six weeks, until prices began to fall. But of those new riders, 15% to 20% became permanent Metrolink customers.

"We're the only ones smiling right now, I think," Hidalgo said. "Our objective is to get people to sample the train--for us, the rain and the gas prices are working very well.'

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