http://www.ctv.ca/servlet/ArticleNew...0?s_name=Autos
The Canadian Press
SILVER SPRING, Md. -- Check out any car dealership in suburban Washington these days and that's exactly what you won't see - cars.
There's no end of trucks, vans and SUVs lined up with military precision, though, and they're likely to stay there for a long time.
Americans paying $4 a gallon for gas are losing their appetite for guzzlers so quickly that some showrooms are having trouble keeping up with demand for smaller vehicles.
"It's been a steamroll - you can feel it," said Clint Rose, a salesman at Sport Chevrolet in Silver Spring, Md., for more than 20 years.
"Last month we sold more cars than trucks. I can't remember the last time that happened."
Customers are trading in their sports utility vehicles for compacts at a brisk clip.
Families with children are augmenting their vans with a second small car to do most of their running around.
Some are opting for crossover utility vehicles that offer size and space but are based on car platforms.
And hybrid cars that run on electricity as well as gas, introduced about eight years ago, are fast becoming a top choice.
"We can't keep them in stock," said Andrew Cort, sales manager at Sport Honda.
While the shakeup in buying trends has been unfolding for months, there's been a much more noticeable change in the past two or three weeks, said Cort.
In the past, climbing gas prices had changed buying habits for short periods but many Americans reverted back to less fuel efficient vehicles when costs fell. But this time, with no sign of gas prices going anywhere but up and the U.S. economy in a tailspin, the American love affair with big vehicles may be over for good.
"There is a very profound and significant shift and it appears that it's permanent this time," said Philip Reed, senior consumer advice editor at Edmunds.com, an automotive research website.
"It's a stormy economic report. It's got people saying: `We need to prepare for the future'."
Foreign car makers are well-positioned for the changing market. American automakers, meantime, are "keeping up a brave front," Reed said from Los Angeles.
"I understand behind the scenes, there's a fair amount of panic. They've made their money on trucks and SUVs. That's given them the biggest profits over the last 10 years."
The widespread housing crisis and credit crunch are also having a major impact on the troubled domestic automotive industry.
Auto lenders and banks aren't doling out financing for cars anywhere near as easily as they once did, with many would-be borrowers being turned away.
Those with loans are falling behind on their car payments at a faster rate than in other downturns.
Some of the busiest people around these days are repossessors.
Steve Ghareeb, owner of Towing Pros and Recovery in Washington, said that part of his business has doubled.
"The gas prices are killing everybody. Add the bad economy and everything else. And it's not getting any better."
As a result, the American auto industry is facing what may be its worst year in more than a decade. Some projections peg expected sales at 15 million vehicles this year, down from 16.2 million in 2007.
In April, General Motors said it would cut production of pickup trucks and SUVs in Canada and the U.S. for the rest of the year, taking out a shift at a few plants including the assembly plant in Oshawa, Ont.
Ford Motor Co. also announced decreased production of larger vehicles last week, adding it wouldn't meet its goal of returning to profitability in 2009.
The switch is expected to result in 300 layoffs at the engine facility in Windsor, Ont., that builds V-8s for SUVs and half-ton trucks.
Chrysler faces a similar dilemma grappling with the lower profit margins of smaller vehicles now in high demand.
The company recently launched a program that caps the price of gasoline at $2.99 a gallon for three years for people who buy or lease new vehicles.
But analysts say Chrysler faces a potential backlash for encouraging more driving at a time when gas costs are making people more aware of the overuse of energy and the damage to the environment.
The price of gas is a potent symbol for Americans. They use it to gauge the country's well-being and their own personal circumstances.
Even though average U.S. prices are still about 20 per cent lower than in Canada, it's been a big shock for Americans to watch them climb nearly a dollar a gallon in the last year and 40 cents in the last month alone.
Many Americans are already changing their habits: using more car-pooling, riding bikes to work, telecommuting from home or taking public transit.
In Washington, transit officials are trying to buy or lease more buses, expand parking and encourage employers to stagger work schedules as they grapple with significant ridership increases.
And local governments across the country are taking some unusual steps to cut costs.
In the small town of Bremen, Ohio, deputies are trading in their squad cars for golf carts as gasoline prices rise.
Police bicycle patrols are making a comeback in states like Pennsylvania, Iowa and Virginia.
And the soaring fuel price of liquid gold has given police a new kind of criminal to catch - thieves who are puncturing or drilling gas tanks and using a container to catch the contents.
Siphoning gas is tougher now in many vehicles that have check balls in the tanks to prevent spills in rollover accidents.
The cost crunch is also changing vacation habits, with studies suggesting a fourth of Americans shortened or abandoned Memorial Day travel plans last weekend - traditionally the beginning of summer travel.
Consumer groups are sounding alarms about a double whammy for drivers this summer season as temperatures soar and they pump warmer fuel into their cars that gives them less energy.
Public Citizen estimates so-called hot fuel - at more than 15.5 degrees Celsius - could cost U.S. consumers an extra $3 billion this year.
There are growing demands for devices on pumps that would adjust for the heat, similar to ones in Canada that compensate for the cold so that gas stations don't lose money when fuel contracts.
The gas crunch is reviving memories of the 1973 oil embargo that significantly boosted demand for compacts and hatchbacks while killing the appetite for full-size luxury cars.
The times forced the Big Three automakers to introduce smaller and fuel-efficient models for domestic sales by the late '70s.
By that time, though, Honda, Toyota and Nissan had captured much of the market with improved, front-wheel drive models that offered better fuel mileage than their American competitors.
And while there' s no problem with supply, as there was in the 1970s, the cost alone is putting a lot of Americans on a new fuel diet.
Two new studies this week signal a potential turning point.
U.S. light trucks sales fell below 50 per cent of all sales in April for the first time since 2004.
And the distance travelled by U.S. drivers in March fell by 18 billion kilometres from the same month in 2007.
While changes in buying and driving behaviour have big implications for U.S. gasoline consumption, analysts say it would take years to have a meaningful impact.
Environmentalists and others, though, couldn't be happier.
"Many Americans are perceiving this as a horrible inconvenience and a breach of their constitutional right to bear arms and have cheap gas," said Reed.
"But a lot of good things can come from it. We can discover clearer skies."