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Monday, January 23, 2012

With growing fuel prices, shrinking modes of transportation

Observation:   Today’s Marketing Daily features a story about the increasing number of people who are adding a motorcycle or scooter to their family’s transportation fleet.  This is a trend driven less by recreation than hedging the household budget against  the price of gas.  (To sift through all of our postings about The Fuel Economy, click here.)  This story gives hope to cycle shops that were having a hard time replacing their now-aging profile of baby boomer customers.  (To see the full MD story, click here.)

Related to today’s story, the North American International Auto Show was held in Detroit earlier this month, and there was no shortage of news about the futuristic cars of tomorrow.  Again, much of the pitch was related toward higher fuel costs in the years ahead.  Several stories—this one from the New York Times—explained that alternative fuel and hybrid cars are showing up in droves at this year’s auto show, even though consumers are not lining-up to buy them.  Click here to see that story.

Another recent story in USA Today explains that cars have grown in sheer size over the past several decades… and logic suggests the pendulum will swing the other way sooner rather than later.  Click here to see that story.

Implications:   If you’re an auto dealer or motorcycle manufacturer, this issue could have an important impact on your company, products and services.  But what if you sell furniture or any other large, lumpy object?  All of a sudden, will more customers be in need of delivery, absent the truck, van or SUV that allows them to bring that merchandise home on their own? 

What of real estate?  If fuel stands to influence the way we drive, it certainly could influence where we live.  Rather than the suburbs or even x-urban homes which have grown so swiftly over the last several decades, might we see a renewed migration toward the city?

What about the business you’re in?

I offer not answers, but questions to consider… as the long-term effects of more expensive fuel is likely to be felt in a variety of ways.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

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