Lower gas prices helps car sales, Cape dealers say

Americans have been paying less at the pump recently. AAA estimates decreasing gas prices saved Americans more than $115 billion in 2015, which works out to more than $550 per licensed driver.

Gas prices now are even lower. In January, crude oil prices dropped to their lowest level since 2003, according to The Associated Press. Earlier this month, AAA reported the national average gas price per gallon dipped below $2 for the first time since 2009.

In Missouri, the average is $1.54. The lower gas prices, especially over an extended time, typically affect the types of vehicles people buy.

Indeed, the drop in gas prices has helped the auto industry.

"Last year was a record year for all manufacturers," said Jason Todt, general manager at Morlan Chrysler, who credits dropping gas prices and low interest rates for the overall industry success.

J.R. Rednour, a sales consultant at John Sinclair Nissan, reviews the features of a Nissan Rouge with a potential customer Thursday in Cape Girardeau.Glenn Landberg

The National Automobile Dealers Association reported 2015 is the sixth year in a row of record sales for the automotive industry.

It was seven years ago that Missouri gas prices reached their highest: $3.95 per gallon.

The dropping gas prices have "lifted the whole market," said John Sinclair of John Sinclair Nissan, "except for hybrids and electric vehicles."

There was a drop in hybrid sales across all models between 2013 and 2014, according to the Alternative Fuels Data Center.

Car manufacturer Toyota reported a 10 percent drop in sales of its hybrid line, Prius, in 2015, although the manufacturer's overall sales were up by 5.3 percent.

New cars fill the showroom Thursday at John Sinclair Nissan in Cape Girardeau.Glenn Landberg

Honda, too, reported a drop of about 24 percent in hybrid sales between 2014 and 2015.

Ford reported a 21.1 percent drop in sales of their C-MAX hybrid cars, as well as a 2.2 percent drop in Fusion sales in 2015, which includes a hybrid line.

But this national trend is not necessarily reflected in car sales is Southeast Missouri.

Paul Horton, sales manager at Coad Toyota, said when gas prices are low, often there will be an increase in truck and SUV sales and a drop in hybrids and passenger cars. But right now, this is not the case.

"Fortunately for us, there hasn't been that great of a difference, at least in our store. Passenger cars are selling briskly, and so are hybrids," said Horton, who credits a new hybrid line and customer loyalty for their steady sales.

But a change in customer priorities can be observed on other lots.

Chris Brown, general manager at Cape Girardeau Honda, said gas prices negatively affect the sales of smaller cars and hybrid cars. If gas prices go up, he expects customers again will lean toward the smaller vehicles.

But the fuel efficiency of new cars has increased across the board, which has changed customer priorities, Brown said.

"What manufacturers have done is increase the fuel economy on standard gas-powered vehicle. If you do the math as far as cost and savings, it takes a long time to achieve an overall savings versus the cost of the hybrid," he said.

Sinclair agrees the fuel efficiency of cars manufactured in the last few years has increased considerably, and people no longer are as motivated to buy hybrid cars as they were. Instead, he said, people are simply upgrading current cars to something newer.

"If you've been driving a small car for the last few years, you'll trade in your 2010 for a 2015 or 2016" and take advantage of the fuel economy that comes with it.

But other dealers say customers are looking to expand.

"We've seen a little pickup in SUVs and trucks," said Todt, who reports 63 percent of Chrysler's sales last year were small SUVs.

"We are seeing a shift toward SUVs," said Brown, who has observed people moving away from both smaller cars and away from minivans as well. "Even more, you're seeing people looking more at SUVs over minivans. Third-row SUVs that maintain a good fuel economy is what people are wanting."

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