Make us your home page
Autos | Trying to save gas, money

Don't rush into new car purchase in effort to save gas, money

Motorists watching gasoline prices climb should think twice about rushing headlong into a new vehicle purchase just to save money on gas, experts say. Here are some pros and cons. Newsday

Pro: You'll start saving money the sooner you make the switch, which will help to pay the cost of the new or used vehicle

Con: You might have to pay a higher price for that fuel miser, because as gasoline prices rise, so does demand for fuel sippers. "Most of us make our worst buying decisions in a panic situation," said author Jack Gillis of The Car Book, a consumer guide.

And there are — or soon will be — shortages of some vehicles made in Japan or containing parts from Japan because of the March 11 earthquake. Said Len Cafarelli, general manager of Huntington (N.Y.) Toyota, "The fuel-efficient cars are flying off the shelf." Gary Schimmerling, who owns Babylon (N.Y.) Honda, said he is short of Fit subcompacts and Insight hybrids, which are made in Japan. "I think you'll see prices will definitely go up because of the demand," he said.

Pro: Most Japanese models sold here, including about 80 percent of Hondas, are produced in North America, with mostly local parts, and although there have been some cuts in production at some North American plants, dealers say supplies of bread-and-butter models like Civic, Accord, Camry and Corolla are ample.

Rebecca Lindland, of auto consulting firm IHS Automotive, says models produced in Japan include Infinitis, most Lexuses, Acuras and some Subarus. "Where you'll find issues as a consumer is if you're very inflexible — if you insist on a vehicle having this color or this interior or this feature, because you're going to wait awhile if they have to order the vehicle," she said.

Con: You could take a big loss on the trade-in or resale value of your current vehicle during a time of rising gasoline prices if its fuel economy is below average. "Historically, a sharp increase in fuel prices has been followed by a decline in large, used SUV prices and, conversely, resulted in an increase in prices for used compact cars," Jonathan Banks, an analyst for the National Automobile Dealers Association Used Car Guide, said in a recent statement. But, noted Cafarelli of Huntington Toyota, you might lose even more if you wait. "As prices of gas go up, prices of gas guzzlers being traded in go down," he said.

Pro: Factory rebates and leases are widely available and interest rates are relatively low, said Lindland, although she adds that lenders still are being picky about things like credit scores.

Con: The nation's economy still hasn't recovered from the recession. Cheryl Mera, who runs a business in Melville, N.Y., that matches companies and professionals to barter goods and services, said she'd like a car that does better than her Nissan Pathfinder's 16 or 17 mpg, but business is too slow. "For me right now, a car would be a luxury," she said. Instead, she's driving less to conserve gas.

Some energy experts think the European financial crisis, the damage to the Japanese economy and rising fuel prices in themselves all could slow economic growth, which would reduce petroleum demand and prices.

It has happened before. "Gas prices will remain high until the situation in the Middle East is resolved," the Kelley Blue Book auto price guide said recently, "but consumers should only sell their current vehicle if their budget forces them to do so."

Don't rush into new car purchase in effort to save gas, money 04/13/11 [Last modified: Wednesday, April 13, 2011 10:39am]
Photo reprints | Article reprints

Copyright: For copyright information, please check with the distributor of this item, Newsday.

Join the discussion: Click to view comments, add yours

  1. Pinellas construction licensing board needs to be fixed. But how?

    Local Government

    LARGO –– Everyone agrees that the Pinellas County Construction Licensing Board needs to be reformed. But no one agrees on how to do it.

    Rodney Fischer, former executive director of the Pinellas County Construction Licensing Board Rodney, at a February meeting. His management of the agency was criticized by an inspector general's report. [SCOTT KEELER   |   Times]

  2. New owners take over downtown St. Petersburg's Hofbräuhaus


    ST. PETERSBURG — The downtown German beer-hall Hofbräuhaus St. Petersburg has been bought by a partnership led by former Checkers Drive-In Restaurants president Keith Sirois.

    The Hofbrauhaus, St. Petersburg, located in the former historic Tramor Cafeteria, St. Petersburg, is under new ownership.

  3. Boho Hunter will target fashions in Hyde Park


    Boho Hunter, a boutique based in Miami's Wynwood District, will expand into Tampa with its very first franchise.

    Palma Canaria bags will be among the featured items at Boho Hunter when it opens in October. Photo courtesy of Boho Hunter.
  4. Gallery now bringing useful art to Hyde Park customers


    HYDE PARK — In 1998, Mike and Sue Shapiro opened a gallery in St. Petersburg along Central Ave., with a majority of the space dedicated to Sue's clay studio.

     As Sue Shapiro continued to work on her pottery in St. Petersburg, her retail space grew and her studio shrunk. Now Shapiro's is bringing wares like these to Hyde Park Village. Photo courtesy of Shapiro's.
  5. Appointments at Raymond James Bank and Saint Leo University highlight this week's Tampa Bay business Movers & Shakers



    Raymond James Bank has hired Grace Jackson to serve as executive vice president and chief operating officer. Jackson will oversee all of Raymond James Bank's operational business elements, risk management and strategic planning functions. Kackson joins Raymond James Bank after senior …

    Raymond James Bank has hired Grace Jackson to serve as executive vice president and chief operating officer. [Company handout]