During a recent conference held in Detroit, Michigan General Motors CEO Rick Wagoner stated that the world’s
largest automaker does not expect current gasoline prices to continue upward at their current rate or impact consumer
spending in the long-term. Gas prices, according to Wagoner, need to be considerably higher than $3 a gallon before
consumers will react.
Wagoner may have good reasons for his argument. While sales of large SUVs and light
trucks have softened recently, GM’s SUVs like the new Tahoe and Yukon were not as negatively affected compared to their
competition. While GM touts better fuel economy for the SUVs as one reason, Wagoner said the media with its
constant “ups and downs” coverage of gasoline prices as one culprit to the public’s pre-occupation with gas
prices.
[Source: MarketWatch]