NADA Chief Economist Looks at Impact of Gas Price Increases


MCLEAN, Va. (April 18, 2006) - NADA chief economist Paul Taylor has looked at the impact of gasoline price increases on used SUVs and full-sized pickups and found that AuctionNet prices fall when gasoline prices rise, and wholesale prices improve when gasoline prices fall, as they did right before the current run up in fuel prices of the last three months.

There seems to be a particularly strong effect when prices rise above $2.60 per gallon, as they have currently. Taylor expects to see prices per gallon above $3.20 per gallon for short periods in many areas of the country over the summer because of the shortages of federally mandated regional gasoline blends and the current higher crude oil prices.

Gasoline will likely decline in price by November to $1.80 or below, assuming no continued major disruptions in world supply. MY 2003 and older SUVs show the biggest impact because the household demographics are most modest for the typical buyer of a 3-or 4-year-old SUV, Taylor noted.

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