The Limit of Gas Prices

According to a new consumer price index developed by AAA, the automobile association, half of U.S. adults consider gas prices “too high” when they hit $3.44. Today’s national average price is $3.52 per gallon, but prices currently vary by more than $1 per gallon nationwide.

The national average has remained above $3 per gallon for 28 consecutive months. While the national average has not surpassed $4 per gallon since 2008, it is not uncommon for motorists living in the West Coast, Northeast and near the Great Lakes to pay more than $4 per gallon.

AAA developed the price index by asking respondents, “At what price do you start to consider the cost of gasoline to be too high?” AAA combined the answers from 974 respondents to determine the potential consumer breaking point for high gas prices, and the report presents the findings of a telephone survey conducted among a combined total of 1,011 adults.

AAA’s gas-price index tracks consumer attitudes by determining at what price the cost of gasoline becomes too high. The results from the open-ended survey demonstrate how attitudes can be expected to change as prices rise above significant milestones:

Roughly two-thirds of Americans (62%) are offsetting high gas prices by changing their driving habits or lifestyle.

The threshold for a given percentage of the population regarding when gas is too high is:

• $3/gallon (46%);
• $3.50/gallon (61%);
• $4/gallon (90%).

Consumers also report changing their driving habits or lifestyle in a number of ways to offset recent gas prices, including:

• Driving less (86%);
• Reducing shopping or dining out (71%);
• Driving a more fuel efficient car (54%);
• Delaying major purchases (53%);
• Working closer to home (39%);
• Carpooling (33%);
• Using public transportation more regularly (15%); and
• Other (18 %).

Young adult consumers are more likely to offset recent gas prices by working closer to home or using public transportation more regularly than adults ages 35 and older.