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Gas-sipping Cars, Not Gas Guzzlers, More Popular

June 18, 2008 - WATERVILLE -- Something small is happening at car dealerships in central Maine and nationwide but, in terms of sales, the impact is huge.

People are flocking to buy smaller, lighter, fuel-efficient vehicles, like subcompacts and compacts.

And they're pulling away from gas guzzling, full-size pickups and SUVs.

Janice and Jim Violette, of Oakland, exemplify the trend. About two months ago, as gas prices spiked, they bought a two-door, 2008 Honda Civic, a model that gets about 28 city/35 highway gas miles per gallon.

"We traded in our 1997 Ford Explorer," said Janice Violette, 48, an account manager at TD Banknorth Insurance in Waterville.

"It was in great shape, but we were getting 15 miles per gallon," she said.

Her husband had used the old Explorer to commute to Bucksport, where he works as an electrician at Verso Paper.

"We had been paying around $700 a month; now it's down to $250," she said of their savings at the pump.

The price of gas has gone up 60 cents per gallon since her last calculations, she said.

Back in February, when gas was still around $3 per gallon, small and mid-sized cars represented only 34 percent of the market. By April, that figure rose to 47 percent, according to AutoObserver.com

The car sales trend is not escaping local dealers.

"People work on a weekly budget. Anything that gets 30 miles per gallon or better right now is very much in demand," said Steve Frend, sales manager at Charlie's Honda in Augusta. "They (customers) want fuel mileage. People commute further for work in Maine than any other state."

Econo-cars like the Civic, Ford Focus, Honda Fit, Chevy Aveo and Toyota Yaris have been strong sellers for some time, Frend and other local dealers said.

But the current, dramatic shift hasn't been seen since the '70s, they noted.

National sales of the subcompact Yaris increased 46 percent in April, and the Honda Fit had a record month, according to a May 2 article in The New York Times.

That month, Ford Focus sales jumped 32 percent from a year earlier. About one in five vehicles sold in the United States in April was a compact or subcompact, a trend called a first by industry analysts, the article said.

Sales of four-cylinder engines also surpassed six-cylinder models; 42 percent of all vehicles sold that month were equipped with four-cylinder engines, according to the research firm J.D. Powers & Associates.

Maine sales mirror the consumer craving for gas-sipping cars, an appetite that appears to be on the upswing.

"Economy cars are selling like crazy -- up 25 or 30 percent," said Lonnie Tinsman, sales manager at Ray Haskell Ford in Waterville, of sales trends at that dealership. One recent Saturday, he said, he sold five Ford Focus models.

"We take as many as the manufacturer can give us," Tinsman said.

Luxy LeClair, general manager of Central Maine Motors Auto Group, sees the same trend.

"We're up 30 to 35 percent in sales of our good-mileage cars at all three stores," he said of Central Maine Motors, Central Maine Chrysler Dodge Jeep and Central Maine Toyota Scion, all based in Waterville. By "good mileage," he meant any vehicle that does better than 25 miles per gallon.

Car buyers are taking notice of hybrids, like the Toyota Prius. And, with that model, demand is not keeping up with supply, LeClair noted.

"There's none on the lot. We're selling them ahead. People are waiting a month or two for the Prius. We can't get the battery packs," he said.

"The Yaris and Prius have an extremely big backlog. There are only enough cars, in general, at the dealer's, to stock to two days worth of business. People are pre-selling before they get here," he said.

Yet, not everybody is buying small, he said. Some customers go from their full-sized pickup to a four-cylinder Toyota Camry that gets about 32 miles per gallon on the highway.

"A lot of people that had trucks for the family vehicle are going to the mid-sized car; those who had mid-sized are going smaller. They're not going from a big SUV to a four-seater," he said.

From his dealership window, car sales are looking good.

"Everyone is talking about the automotive industry being slow. We've had two of our best months ever," he said.

Nonetheless, pickup truck and SUV sales have dipped, he said, an observation that reflects a national trend. Full-size pickup sales have fallen more than 15 percent this year, according to industry analysts.

"You'll see more economy cars being built in a few years," he said.

Sales for the F-150 pickup have plummeted about 27 percent in April alone, according to The New York Times article.

Local Ford dealerships are doing better with their smaller cars, too.

"We're selling more of the Ford Focus," said Kevin Baker, sales manager at Quirk Ford in Augusta. "It's been a popular car to begin with. We're up in sales from last year. There's no waiting list," he said.

But the Ford Escape hybrid, a model that gets about 34 miles per gallon, usually needs to be ordered. And, so far, there is not a big demand for the Escape.

"A couple of people a month inquire. We sell 10 or 12 a year -- maybe one a month," he said. The Ford Edge, a crossover between a van and an SUV, is also moving, he said.

"Van sales are off. They don't make a van anymore," he said of models like the Windstar.

Sunday June 15th, 2008

by Lynn Ascrizzi, staff writer, Kennebec Journal


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