Driving prices
Companies use fuel costs to attract customers
Irene Kitzman, human resources manager for Victory Motors, sits in a new Dodge Grand Caravan while holding a card advertising Chrysler’s “Let’s Refuel America” program. The deal guarantees gas for $2.99 a gallon for the next three years to those who buy a new Chrysler, Dodge or Jeep vehicle. Victory Motors and Cook Chevrolet offer eligible cars at their Craig locations. Enlarge photo
June 5, 2008
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Local gas gauge
Regular unleaded and diesel prices as of Wednesday:
Conoco 140 W. Victory Way
• Unleaded: $4.099
• Diesel: $4.899
Gofer Foods (Conoco) 923 E. Victory Way
• Unleaded: $4.099
• Diesel: $4.899
Kum & Go 700 E. Victory Way
• Unleaded: $4.099
• Diesel: $4.899
Kum & Go 1302 W. Victory Way
• Unleaded: $4.159
• Diesel: $4.899
Loaf ‘N Jug 2441 W. Victory Way
• Unleaded: $4.099
• Diesel: $4.899
Petrowest 301 School Road
• Unleaded: $4.119
• Diesel: $4.899
Sinclair 666 W. First St.
• Unleaded: $4.089
• Diesel: $4.859
Trevco 702 Industrial Ave.
• Unleaded: $4.109
• Diesel: $4.869
Craig — Craig resident Brenda Gustafson, 50, doesn’t think gasoline prices will come down. Her take on current prices isn’t any more optimistic.
“It’s bad,” Gustafson said. “But, unfortunately, it’s not as bad as it’s going to get. Just supply and demand.”
Gustafson drives a Dodge truck with a Cummins diesel engine. She figured her truck got about 18 miles to the gallon in town and 22 miles a gallon on the highway.
“I’m paying out the wazoo,” she said.
If diesel gas gets much more expensive than the current $4.89 average across Craig, Gustafson said, she may have to give up on her truck.
“There’s going to be a tipping point pretty soon,” she said. “I’m considering at some point buying a moped. (Gas) is starting to put the pinch.”
Businesses across town aren’t blind to the soaring gas prices. Nor are businesses blind to the fears of their customers, who may have paid a record high for unleaded gas this week with average regular unleaded gas prices across Craig sitting at $4.109 a gallon.
Craig Ford offers employee discounts to all customers who buy an F-series truck. General Manager Kevin Harvey said the auto industry is slowing down in general because of fuel prices, and Ford wants to promote its vehicles.
Harvey added the new discount could save a person between $6,000 and $7,000.
Victory Motors of Craig, Cook Chevrolet, City Market and Loaf ‘N Jug all offer customer incentives using price breaks at the pump.
City Market and Loaf ‘N Jug, both part of The Kroger Co., offer a joint promotion if a customer buys $100 in groceries at City Market, he or she then gets a coupon for 10 cents off per gallon, up to 50 gallons, at Loaf ‘N Jug.
Victory Motors and Cook Chevrolet are participating in Chrysler’s “Let’s Refuel America” program, which guarantees new car-buyers will pay $2.99 a gallon for 87 octane unleaded gas or diesel fuel for three years.
The offer is available on purchases of new Chrysler, Jeep and Dodge vehicles through June 30.
Here’s how it works:
After buying an eligible new car, the customer receives a special gas card in the mail. Then, the customer “marries” that card to a credit card they already own.
The person then uses that credit card to buy gas, and when the bill comes it will show charges for $2.99 a gallon.
However, the customer has to choose among getting the gas deal, taking a rebate or accepting a low interest rate program on their financing. Chrysler limits the number of gallons it discounts per year, also, but offers more gallons for less full-efficient vehicles.
Brian Kitzman, Victory Motors sales manager, said there has been a lot of interest from people coming into the showroom and calling on the phone.
Gas prices are becoming a concern for customers, and fuel mileage is a selling point for dealerships, Kitzman said.
Hybrid vehicles, which landed on the market without much applause, he said, are starting to be big sellers.
“People, they’re starting to open their eyes,” Kitzman said.
Out of car sales since the gas card program started in mid-May, he said, about 25 percent — or 20 people — have taken the gas card instead of other rebates or financing.
Generally, those people are customers with other vehicles that run on diesel gas, Kitzman said, which is about 79 cents a gallon more expensive than unleaded fuel in Craig.
Scott Cook, who owns Cook Chevrolet, also said the gas card program has generated a lot of interest, and he agreed that fuel mileage is becoming more important to car-buyers and manufacturers.
However, Cook said he doesn’t see a lot of new sales because of the program. The country’s economy in general is slowing, and people are more afraid to buy big items than they once were.
“People are kind of in neutral,” he said. “I think they’re going to wait and see how the economy all settles out. They’re probably just as worried about new car payments as gas costs.”
Cook said he wonders if motorists will accept $4 a gallon, assuming that’s where gas prices stabilize. In reality, he said, recent price spikes don’t amount to a ton of money more than what people paid six months ago.
“I think there’s a lot of overreaction out there,” he said. “It’ll be really interesting to see if $4 a gallon is the point where people say, ‘I’m going to change my lifestyle.’”
One man visiting Craig Wednesday doesn’t plan on changing anything, even though he lives his life on the road.
Nine years ago, with diesel fuel about 99 cents a gallon, Dennis Orr sold everything and took to the road in his recreational vehicle.
He’s been driving across the country full time since then, he said.
In nine years, diesel fuel went from 99 cents a gallon to Wednesday’s average price of about $4.70 a gallon in Colorado.
Orr said that will not stop his travels.
“Oh no, we’re not going to stop traveling,” he said. “We’ve stayed in places a little longer than we used to, but we’re not going to stop traveling.”
Collin Smith can be reached at 875-1794 or cesmith@craigdailypress.com
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Question of the week
Moffat County rancher Rodney Culverwell begins his jury trial Monday on charges of poaching elk on his property. He contends he was protecting his property. What do you believe the trial’s outcome should be?
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5 June 2008 at 5:57 a.m.
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taxslave (Anonymous) says…
GM closed 4 manufacturing plants this week, (trucks and SUV's). Continental laid off 3,000 employees this morning and cut it's fleet 25%. Yesterday United did the same but cut 35% of their fleet. Sorry, a gas card just isn't going to cut it. The cheap flights are gone and so are the snacks in Coach. Soon they'll be charging you a quarter to use the in-flight bathroom. (no joke), at the airports too.
Did all of you catch the announcement in this paper last month about the 23% increase coming in natural gas, residential and commercial? Higher property taxes and now fuel. Where do the fixed income people turn to?
The economy itself can not afford $4.00/gal. fuel.
5 June 2008 at 8:31 a.m.
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redneckgirl (Anonymous) says…
“I think there’s a lot of overreaction out there,” he said—that was the quote from Mr. Cook. I agree with you taxslave, I commute to Steamboat everyday in my cheap little car and it's getting hard. I also own a diesel pickup that has been more of a driveway ornament lately. I have it to pull my big camper with but the diesel fuel prices will be putting a damper on our camping season this year-along with the snow in the high country still. My kids are both dirt bike riders/motocross fans but we've turned to riding our leg powered bikes instead-which is better for them anyhow. Our snowmobile riding this winter was also cut down, not only do you have the price of gas to ride them but you have the diesel fuel to get up to places to ride them at. I am loving my little car that gets 39-42 MPG on the highway though!! I really need to stop overreacting here though….
5 June 2008 at 8:35 a.m.
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50cal (Anonymous) says…
taxslave, the largest producer of natural gas around rifle just shut in 40,000,000 cfm of gas because the current price was to low to sell.
5 June 2008 at 9:27 a.m.
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harkner (Neal Harkner) says…
You know I really don't feel sorry for Ford, GM, or Chrysler, as terrible as that sounds. All 3 of them, Ford especially, put all their eggs in the SUV and truck basket. They hoped to ride the wave of cheap gas forever and even the dimmest bulb knows that oil is a finite resource and whether we have a 30 year supply or a 300 year supply left, finding new deposits is getting vastly more difficult. Detroit has over the years largely been reactionary rather than revolutionary, and this time it's biting them in the rear.
Honda & Toyota have been eating into their sales for years. Over the last decade Kia and Hyundai have taken market share away from them as well. While gas was $1.50 a gallon it wasn't a big concern to Detroit, but now that oil's spiked which companies are poised to handle high gas prices the best? Honda, Toyota, Kia, and Hyundai.
5 June 2008 at 2:24 p.m.
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jmemcse (Anonymous) says…
I have figured out how to make a hydogen on demand system that would entirley fuel a car. It uses 2 twelve volt coils, aluminum wire, and a rotating aluminum drum. It is basically like welding underwater in the ocean (saltwater). My design includes an over pressure sensor/relay, spark arrestor, volume regulator, and a cooling system. The hydrogen released would get jetted directly in to the injector intake. I'm in the process of researching salinty/freezing point of the water. The only cost would be water, salt, baking soda, and aluminum wire. I hope to build my device this summer. Hopefully I won't blow myself up in the process. Wish me luck.
5 June 2008 at 4:27 p.m.
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grannyrett (Anonymous) says…
jmemcse-Go to water4gas.com or google hydrogen for fuel. They are already doing it. I have friends in Arizona who are doing it.
5 June 2008 at 4:31 p.m.
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redneckgirl (Anonymous) says…
I wish you lots of luck and hopefully you don't live near me. Yikes! If people could figure out the bio diesel thing with the left over french fry grease then I'm sure anything is possible. More and more people are going to be figuring out ways to not have to use gasoline or diesel fuel. I wish my car would run on dog poop, I have lots of that having 5 dogs. (I wouldn't want to be the guy behind my car though-ick!) and I don't think I would want to be the one “filling up” my car.
5 June 2008 at 9:05 p.m.
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50cal (Anonymous) says…
should be ruin your engine water4gas.com. I want to know how these going broke car companies can buy 2.999 for your vehical for 12,000 miles per year and I can't.
5 June 2008 at 10:22 p.m.
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harkner (Neal Harkner) says…
50cal - They're giving you the $2.99 gas in lieu of all other incentive offers - i.e. you pay close to sticker price for the car.
6 June 2008 at 12:08 a.m.
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harkner (Neal Harkner) says…
50cal - More food for thought. The program only gives you 12,000 miles worth of gas per year. So if you buy a car that gets 20mpg, you'll use 12000/20 = 600 gallons of gas per year.
Assume that gas is $4 a gallon. Their cost per gallon is $1.01 ($4.00-$2.99)
600*$1.01 = $606/year = $1818 over the 3-year period.
If they offer $3000 cash back, it's smarter to take the cash back than the cheap gas.
6 June 2008 at 7:23 a.m.
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taxslave (Anonymous) says…
Yepper, you always “take the money”.
A friendly warning….I expect gas to go to 6 bucks/gal in less than a month. I hope I'm wrong but I don't think so…..possibly before July 4th.
6 June 2008 at 8:55 a.m.
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50cal (Anonymous) says…
I knew that it was a game being played but its amazing that they are all going broke and can offer incentives.
get it to 6.00 per gallon and then drop it back to 4.09 and we will feel like we got a break.
6 June 2008 at 9:02 a.m.
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harkner (Neal Harkner) says…
They'll always offer incentives especially on the cars with the widest margins. Why do you think they can afford to give you $5000 plus back on a truck? They're still making money ;-)
6 June 2008 at 9:13 a.m.
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50cal (Anonymous) says…
its jusst funny how broke they are going, showing all these loses and still “giving all this money back to the customer” now your financing a car for 7 or 8 years. maybe everyones missing the point. extend the financing out, let the customer pay for another year or two and they have NOT lost any money. Neal i'm a terrible artist and a worse speller PLEASE don't make me draw a picture
6 June 2008 at 10:11 a.m.
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50cal (Anonymous) says…
Neal, do you know who owns 41% of toyota?
6 June 2008 at 10:25 a.m.
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harkner (Neal Harkner) says…
Oh the longer you finance the more interest they make on the loan. According to Toyota's website their top 2 largest shareholders are banks.
Why GM ever divested itself of the only consistently profitable subsidiary it had, GMAC, is beyond me.
6 June 2008 at 10:36 a.m.
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50cal (Anonymous) says…
sweet
6 June 2008 at 2:16 p.m.
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grannyrett (Anonymous) says…
Heard on the news when they were doing the hearings with the oil companies that they had been making 10 cents a gallon and were now only making 4. Their expenses have risen. Now, if someone can explain this to me, go for it: When you run a business, the profit is what is left over AFTER expenses. Therefore money in-expenses=profit. So, how are they not making money when they are recording record profits? Someone–Please explain this to me.
6 June 2008 at 2:21 p.m.
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taxslave (Anonymous) says…
Bad news about gas. Crude is up over 10 bucks/barrel today.
6 June 2008 at 7:32 p.m.
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50cal (Anonymous) says…
you will hear lots of stuff coming out of lots of peoples mouths granny. how about this the federal government gets 18 cents for every gallon the state of colorado gets 22 cents for every gallon. they have both now thrown out regulations and the threat of regulations that oil companies are having to fight that as well. wouldn't you think if these mean ol oil companies were jabbing it to every one else they would save themselves? amazingly that they have to pay the same for fuel as the rest of us for all that exploration and transportation. lets tax them and see where that ends up or how bout you give back all that money in the 401k that BIG OIL made you?Lets ask the government to lay off the taxes that they pull out for doing nothing and give the companies a chance to find domestic energy. oil companies DO NOT set the price of oil the commodities market does. speculaters look ahead and try to find trends in the market that they can turn a profit. Opec watches the daily output of oil to make sure they do not flood the market and drop the prices.