A survey by Kelley Blue Book says that new car shoppers are giving up Starbucks to help offset the cost of $4 gas. Sorry, big green mermaid lady! The KBB study results reveal that 28 percent of new-car shoppers have stopped going to Starbucks or other coffee houses entirely, and 21 percent indicate they are going less often due to skyrocketing gas prices.
“What was once a frequent occurrence such as the morning trip to Starbucks or taking the family to a ballgame just isn’t as financially feasible when $4-per-gallon gas must also share a place in the budget,” said Jack R. Nerad, executive editorial director and executive market analyst for Kelley Blue Book and kbb.com. “The fact that nearly three-quarters of new-vehicle shoppers see this as a permanent situation demonstrates the enormous effect that skyrocketing fuel costs can have on not just the auto industry, but the entire American economy.”
Not everyone is sad, however. The Toyota Prius is dancing on the grave of the latte (and the Hummer?). KBB says “sixty-two percent of shoppers say that gas prices have either changed their mind or made them think strongly about vehicles they normally wouldn’t have considered.”
GAS PRICES CAUSE NEW-CAR SHOPPERS TO CUT SPENDING, BELIEVE SITUATION IS PERMANENT [KBB]
(Photo: Paxton Holley )
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I know that Starbucks!
Isn’t one of the obligatory rules in those dopey “Top ten ways to cut your spending every month” to cut out your daily latte at Starbucks?
@rdldr1:
OMG me too! Its the one by all those newspaper boxes. Hey I’m gonna grab a Pennysaver real quick.
I would go into that starbucks just so I could ask if they knew where I could get a newspaper.
@sean77: good one
Ben Bernanke and his predecessor thought / still think that energy inflation is an isolated component of the “big basket”. Despite entry level college econ classes that teach otherwise, they see the effects of energy inflation limited to energy itself, and not affecting the larger economy.
Hopefully Ben Bernanke is reading this post.
@humphrmi: And in case any of you are wondering what my point is, it’s time to raise interest rates.
@humphrmi: College level econ classes? What are you, an elitist?
I never did like coffee. I guess I’m just out of luck, nothing left to cut out of the budget.
New strategy: Drop prices and put a location on every corner instead of every other corner to increase volume.
I don’t have to worry, there’s a Starbucks in my basement.
@rdldr1:
Funny, I was thinking the same thing, but only when I saw the Redeye box did it actually confirm my suspicions.
Starbucks is a fashion botique that markets burnt water as liquid jewelry.
said it before and I’ll say it again: buy a scooter! 90 MPG!
What a shame.
Buy good coffee (whole bean Peets?) and brew your own.
I used to go to Dunkin Donuts twice a day. once in the morning for a hot coffee and once a few hours later for an iced coffee and bagel breakfast sandwich.
I’ve recently cut out the 2nd trip and if gas keeps going up ill have to quit smoking which just wont make me a happy camper. Its either that or video games…and there is no way im cutting out my only hobby. Damn you to hell oil companies!
i actually make it a point to go to my local coffee shop. it’s not a starbucks and recent pricing (like no more free free refills) has kinda made it obvious they’re having a hard time. i want them to stick around.
I really have nothing substantive to add, but I never connected driving with Starbucks, since I have never, in my life, ever driven or otherwise taken a private vehicle to a Starbucks.
@backbroken: No shit, I learned how energy affects food & leisure in like ECO 101. I guess BB must have been sleeping during that class. Meanwhile us elitists were obviously from families that could afford good caffeine pills.
it took $4/gal for people to change their bad daily financial habits? much like $8/pack to quit smoking. my grandpa quit smoking back in the 60s bc the price went from 63 cents -> 66 cents. He’d be having his 5th heart attack if he was still alive to see all this.
We go to Starbucks MORE because they’re easily accessible by bus or foot, whereas some of the other stuff we like to do, like hiking, requires a long drive to get there. Even here in Mexico I can walk to two Starbucks (and one Star Box Coffee!).
One of my favorite things to do is watch the original version of The Italian Job and complain about how every place they filmed in that movie was within walking distance of my old apartment. I seriously hope the North American urban planners of days of yore are kicking themselves right now. Also, I hope all the urban planners who continue to build suburbs a billion miles from anywhere all fall in a big hole and get stuck there for a long, long time.
@humphrmi: Wait, I thought Econ was reading ‘Atlas Shrugged’ over and over again.
@spinachdip: its not quite that simple. High gas prices are eating away at people’s budgets. People have less disposable income and therefore they drink less coffee
It sounds like Starbucks is in danger of becoming the next Krispy Kreme.
@petrarch1608: I’m not sure where I’ve simplified anything. I think you misunderstand me – it was more an observation about my own experiences and my apparent disconnect from the majority, since I drive occasionally and I go to Starbucks occasionally, but I have never done the two at the same time.
How about if Starbucks starts brewing shredded Escalade tires?
Bah, good riddance to Starbucks and their burnt water. Just go get Maxwell House french roast, brewed so strong you can barely stand it, and there you go. I guess I just have simpler tastes, every time I go into Starbucks and order a regular coffee they look at me like I’m two seconds from flinging my poo at the walls like the retarded monkey I am.
@humphrmi: Yeah, I liked the fed much better when their prime directive was to keep inflation in check, and otherwise get the hell out of the way.
@spinachdip: Econ ain’t got no room for silly Philosophical studies. As geeky as the Econ students were, the Phil students were the ones they laughed at. Those guys were probably reading Atlas Shrugged while we were all arm wrestling over Keynes vs. Friedman.
People are stupid.
If you drive the average (15k miles a year) with a car that gets 20 mpg, $4 gas costs you like $3,000. Not an insignifcant sum, but not the end of the world either.
@Jetgirly: Let me understand this. You’d rather walk to a Starbucks than hike. In Mexico. And yet you blame urban planners for our problems. OKAY.
Oh good, the dredge of society is being hurt by rising gas prices.
Yep, I am no Starbucks fan.
But guess what, if Corn prices continue to rise at a rate faster than gas prices there are going to be some serious issues in this country that rival the fun times of 1930-1936.
@duffbeer703:
The worse part is the fact that gas cost $2250 last year, and increase of $750 in one year, but the whiners will cry over the $3000 gas rather than the $750 increase in one year.
@planet2334: I like coffee, and so don’t frequent Starbucks but brew my own, meaning that’s there’s nothing for me to cut from my budget either.
LOL,sorry I couldn’t resist.
What the heck did people think would happen when you are OVER charging 4 times what it’s worth or the competition is charging.
Hey,Starbucks cashed in on craze,helped perpetuate it a little longer but now it’s time to pay up and live in reality.They always will have A niche of the luxary coffee market.Starbucks is the Krispy Kreme of the coffee world-for about 2 years they to were all the rage(also over charging,unable to stave off the competition) and now Krispy’s stock is about 1/10 of it’s peak…
Never got Starbucks;even when I had enough for a visit.
@jamesdenver: Isn’t one of the obligatory rules in those dopey “Top ten ways to cut your spending every month” to cut out your daily latte at Starbucks?
LMAO! So true. Every other week here or at lifehacker we’re told to stop drinking Starbucks and now they blame it on gas prices.
@Jetgirly:
Also, I hope all the urban planners who continue to build suburbs a billion miles from anywhere all fall in a big hole and get stuck there for a long, long time.
I’d pay a lot more in gas prices before I ever live in a crowded urban city. Most people would rather live away from it all in quiet.
I drive 20 miles to work each day and frankly would rather live even more remote at times.
@duffbeer703: that’s not really the whole picture. what might seem like a relatively manageable increase affects everything else. ergo, the rise in food prices. it’s a catalyst that affects everything else, and ultimately what really matters in a jittery free market system is consumer confidence.. it all rolls up into one fabulous snowball.
If Starbucks wasn’t so fucking expensive they wouldn’t have a problem! Make your own from home, it’s much cheaper and if you screw it up you can just kick your own ass!
It’s going to be least-necessary and most expensive things that get cut out of the budget first, so it’s no surprise that $4 coffee drinks are in the top 10.
The price of just about everything has gone up and wages haven’t, so there you go. Hey, at least my car doesn’t run on Starbucks coffee..that would make $4 a gallon gas seem cheap in comparison.
Hey Meg, the link to the flickr photograph is missing the htt part of the URL…
Who cares about Starbucks. These insane gas prices are cutting into my gourmet $5 frozen yogurt and $4 cupcake budget. I guess I can’t buy the new 3G iphone now.
Oh the horror!
@humphrmi: I actually love the nerdiness of serious economists – my regular readings include the Freakonomics and Kruuuuuuuugman blogs, both of which are chock full of nerdery and humor.
It’s just that the folks running shit tend to be the Rand-worshiping neo-Libs who view economics more as a religion than a living, breathing slice of reality.
haha…
So if you sell audaciously expensive coffee, the first thing people think of when they want to save a few bucks will be the overpriced coffee they blow so much money on.
recently i saw a commercial for a local car dealer and I am not joking this is the statement….
Two couples outside the dealership: “Yeah the hummer is great, i feel safe in it, its a great value and it gets decent gas mileage so we got two”
My brain just cant handle the word HUMMER and decent MPG in the same sentence so i think i blacked out for a bit….
I normally go 3-4 times a week, and that hasn’t changed. Maybe the people in the survey aren’t going because now in addition to a house payment they can’t afford, they now have a high car payment as well.
According to the photographer’s flickr page, that’s a starbucks in Chicago. But it looks just like the one on Hawthorne in Portland! Maybe it’s just all the newspaper boxes out front.
@MT:
Yes, they all pretty much look alike.
here’s FOX’s coverage of the solution
—->
For alot of people, $3000 is one month’s pay. So fuel is costing them 1/12 of their income. If they can cut the daily Starbucks @$5.00 daily and replace it with a $1.00 convenience store coffee, that offsets $1,000 of expenses elsewhere – in this article that expense is gas.
Now only two things are possible, either starbucks should arrange for cheaper Gas or Gas station should arrange for free coffee.
Sachin