Spending on Gasoline Hits a 30-Year High

Good news! According to the U.S. Energy Information Administration, Americans had to spend only 4% of their pre-tax income on gasoline for their cars in 2012 -- a sum that hasn't increased since seven years ago.

Horrible news! According to the same U.S. Energy Information Administration, Americans had to spend a whopping 4% of their pre-tax income on gasoline for their cars in 2012 -- which works out to $2,912. That's the most dollars Americans have had to spend on gas at any time in the past 30 years.


Source: US EIA.

So ... which is it? Is this revelation from the EIA good news or bad news? Obviously, it depends a bit on how you look at it (and on which qualifiers you put inside the parentheses). For example, one way to put the EIA's figures in a positive light is that, if the dollars spent go up, but the percentage of income those dollars represent stays flat ... logically, this must mean people are earning more dollars from their jobs. So even if it doesn't feel like it for many of us, apparently, wages have gone up!

You can also take heart from the fact that, even if the dollar figure of $2,912 sounds bad -- "$2,912? Why, that's a couple of mortgage payments!" -- it could have been a lot worse.

According to the University of Michigan's Transportation Research Institute, improvements in fuel efficiency in American cars have improved fuel economy by 40% since 1970. What's more, nearly half of those efficiency gains -- 17.8% -- have taken place over just the past five years. Had they not, then Americans could easily have spent as much as $3,430 on gas last year. That would have been close to 7% of pre-tax income, and easily the most we've ever spent on gas, as a percentage of income, as gross dollars -- really, by just about any measuring stick you care to use.

Give 'em a hand
Rant all you want about the greedy executives at ExxonMobil and the $44.9 billion in profits they raked in last year, but when you look at those efficiency figures, the question of "who's to blame for us spending so much money on gas?" quickly switches to "whom should we thank for saving us so much money?"

Here, the obvious answer is: Japan ... and South Korea. According to TrueCar.com, which tracks the average fleet fuel economies of the major automakers, Honda , Nissan, Toyota , and Hyundai currently score highest on average miles per gallon of the cars and trucks they produce.

However, Ford also deserves a round of applause. Among all the major automakers, Ford made the greatest strides in improving the fuel efficiency of its fleet last year. It added 2.8 miles per gallon to its car fleet, and an astonishing 3.4 mpg to the efficiency of Ford trucks.

And GM , the oft-reviled "Government Motors," that supposedly kowtows to Big Government's Green Agenda? It was arguably worst of the lot. In 2012, GM was second-to-last in fuel economy improvements for cars, and dead last in trucks.

Worried about Ford?
If you're concerned that Ford's turnaround has run its course, relax -- there's good reason to think that the Blue Oval still has big growth opportunities ahead. We've outlined those opportunities in detail, in the Fool's premium Ford research service. If you're looking for some freshly updated guidance to Ford's prospects in coming years, you've come to the right place -- click here to get started now.

The article Spending on Gasoline Hits a 30-Year High originally appeared on Fool.com.

Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool recommends Ford and General Motors and owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Cma Energy

Fools of government are no better than you
When government will not help to really stop high gas prices just to keep the tax dollars flowing into their coffers. Are you any better?
Would you like to see high gas prices gone or should we say completely eliminated?
You scream yeah, but will you do anything to help? NO your a non believer and no better than a fool!
Otherwise you would be willing to help a devoted research investigator your government has blocked from forming a research facility.
But would you like to help a 33 years of research in a field they do not research except they love to research it's related fields?
Think about it if you have the brain power. www.hometogiveaway.com Is this the only way to raise funds? Or will you be like everyone else and just ignore this simple request in exchange for your next bottle of tonic water to ease the pain! A fool cannot see past the end of his or her nose!

May 08 2013 at 11:03 AM Report abuse rate up rate down Reply
k4jlp

What? 45 billion profit for just Exxon-Mobile in one year? Where do you think that money come from? it came out of OUR pockets and Congress via the repeal of the Glas-Steagle Act of 1933 in the year 1999 by the Republicans allow it to continue via the commodity speculation. Gas at the pump should be no more than 1.89/gallon...do you homework and see for yourself.

May 05 2013 at 7:44 AM Report abuse rate up rate down Reply
k4jlp

We have NO MORE EXTRA money, the Health, Energy and the IRS have took it all and WE HAVE HAD ENOUGH.....our patience has worn THIN. Congress are you listening?????

May 05 2013 at 7:36 AM Report abuse rate up rate down Reply