$2 gasoline: how it could change US

From the towering headquarters of Shell Oil Company, Houston's octopus-like freeway system seems to sprawl endlessly over the flat Texas landscape. "This city was built around the automobile," declares S. M. Lambert, a futurist and manager of energy planning for Shell.

The same could rightfully be said of many aspects of modern American society. Jobs, housing, recreation, and life styles in general have evolved in ways dependent on automobile mobility.

But as gasoline prices rise sharply -- up more than 60 percent last year, headed for $1.50 a gallon this year, and aiming for $2 a gallon in two or three years, according to a number of energy analysts contacted by the Monitor -- American consumers are making gradual and fundamental adjustments.

The changes begin with "public acceptance, for the first time, that the energy crisis is for real" and that higher gas prices and tight supplies are here to stay, says a top official with the National Highway Traffic Safety Administration. He bases the conclusion on consumer surveys of automobile buyers conducted by the agency and contrasts the attitude to the public skepticism about energy shortages that prevailed less than two years ago in similar surveys.

Changes in this car-dependent city mirror what is happening nationwide: There are more small cars on the roads; public transportation use is up and service is better; downtown housing is at a premium; speed limits are more closely obeyed; more companies are offering van pools or helping employees organize car pools to work; working hours are being set with an eye to avoiding traffic congestion; more money is going to improving roads rather than building new ones; vacation travel is changing, and open gas stations are harder to find.

"The simple fact is that the great majority of the American public cannot afford to pay those kinds of prices [and maintain their current life styles]," says Mr. Lambert, who believes $2-a-gallon gasoline is "inevitable" in the next few years.

Indeed, resistance to higher prices, as well as tight supplies, resulted in a 5.1 percent drop in US gasoline consumption in 1979.

The most evident change is taking place in what consumers look for in an automobile. One Dallas commuter who drives a full-sized eight-cylinder automobile vows: "I'm going to switch to a smaller car right away. I've already changed my driving habits so I don't use the car needlessly."

Driving that full-sized automobile one mile will cost 24.7 cents on the average this year, when gasoline, insurance, and all other costs are considered, according to Runzheimer & Co., a Wisconsin management consulting firm. That is twice the cost of driving one mile in 1970, even though there have been government-mandated improvements in auto fuel efficiency in recent years.

While the cost of driving in relation to Americans' income has held relatively stable over the past decade, skyrocketing fuel prices are beginning to change that.

"It looks like it will take more of the pay- check to run a car in the future ," speculates Woulter Van de Bunt, a researcher with Runzheimer & Co.

For Americans in general, reluctance to pay more for personal transportation has meant a rush to smaller, more fuel-efficient cars. Small vehicles -- both domestic and imported -- composed the majority of US car sales last year, although they did not as recently as 1977.

With consumer demand and government prodding, automobile design is expected to change dramatically in the next five years as fuel efficiency becomes a premium sales feature.

Front-wheel drive, lighter frames, and more electronic technology to precisely regulate exhaust emissions and fuel consumption will be typical, says Richard L. Strombotne, director of fuel economy standards at the National Highway Traffic Safety Administration.

"Fuel economy in the range of 40 to 50 miles per gallon is not impossible by the mid- 1990s," with new automobile designs, he predicts.

Even with more fuel-efficient cars, higher gasoline bills will continue to price some people right out of the drivers seat and into a bus, subway, or trolley.

"For a lot of poor people, driving is a luxury they just cannot afford," says Mr. Strombotne.

Use of public transportation scored its biggest increase of the 1970s last year. Ridership rose 6.7 percent in 1979, according to the American Public Transit Association, a trade group.

Still, analyst Gary Ceccucci of the Urban Mass Transportation Administration (UMTA) anticipates no "major shift" in the near future in the use of public transportation. Ridership will grow, principally on city buses, but Americans will continue to rely on private vehicles for more than 90 percent of their commuting, he said.

"The alternatives with most potential are car pooling and van pooling," Mr. Ceccucci said.

Major new subway systems, like BART in San Francisco or the Metro in Washington, are so costly that their development in other cities will be limited , federal transportation officials concur. Likely candidates for new rail systems are Los Angeles, Miami, and Honolulu, according to UMTA.

The Carter administration has given strong support to public transportation in its 1981 budget, with a request for $3.9 billion for UMTA programs -- an increase of $1.65 billion over last year.

Private car pools and van pools are seen as having great potential for drawing motorists out of their own cars because they are perceived as less inconvenient and more reliable than a public transit system.

Also, since there continues to be rapid development of many suburbs, companies can adjust their transportation programs to the location of their work force.

"What we see is industry moving to where people want to live, creating more satellite cities," says Mr. Lambert.

Will higher gasoline prices change where Americans want to live? "We struggle with that question a lot, but I don't see much change. What is happening is the jobs are going to the suburbs," said E. L. (Bud) Krodel, a vice-president with Fox-Jacobs, Inc., a major Texas home-builder.

Still, Mr. Krodel says, downtown housing is more in demand and "skipped-over property close to town is getting second looks" from builders. Also, he says, new development beyond the suburbs has slowed.

Downtown revitalization of many older cities is certainly under way, points out economist William Young of the National Association of Home Builders. "But the advantage of being close to the city is often eaten up by the higher cost of the home," he adds.

How Americans spend their free time will be greatly affected by higher gasoline prices. Hopping into the car for a weekend jaunt to the beach or the countryside will be more carefully considered, as will how to spend the yearly family vacation, recreation experts forecast.

"People can't just drive away from the city for fun anymore," says Mayor Ted Wilson of Salt Lake City.He expects the public demand for urban parks and recreational facilities to jump dramatically over the next decade.

Americans are increasingly reluctant to invest in campers, vans, and other recreation vehicles. Last year sales tumbled 40 percent in the wake of the revolution in Iran and its disruption of world oil supplies.

Also, consumers appear to be settling for more modest vacations and are being more cost-conscious in how they travel. The American Automobile Association reports member requests for trip-planning material dropped 17 percent last fall over a year earlier.

Bus travel last summer reversed its downward trend dating back many years for Trailways, Inc., and continues to rise in 1980 as travelers look for alternatives to the automobile.

"Consumers are adjusting [to] higher gas prices right now, and if it goes beyond $1.50 a gallon, there will be dramatic changes," maintains James Kerrigan , chairman and chief executive of Trailways.

Travelers, both business and pleasure, turned to airlines as an alternative to car transportation last year. "Flying to Florida from the Northeast was often no more expensive than the cost of gas -- never mind motels and food," noted an official with the Air Transport Association.

But the discount air fares that drew new customers last year are being dropped or reduced now as fuel costs mount for airlines. The Air Transport Association expects a leveling off -- and perhaps a decline -- in US air travel in 1980.

Passenger traffic on Amtrak also increased substantially in 1979.

"One of the most popular new modes of vacation travel will be air travel, plus car rental," said Jan Nichols of the US Travel Data Center in Washington.

At a recent travel outlook forum held by the center, tourism experts from a number of industries forecast more package tours in the years ahead. Hotels and motels will work with transportation companies to provide package travel accommodations for those who do not want to drive.

In general, the forum participants found that Americans are taking vacations closer to home and staying with friends and relatives more often, in response to higher gasoline costs. After adjusting for inflation, total tourism revenues actually declined in 1979 compared to the previous year.

Technology also will play a role in helping Americans adjust to higher fuel prices. Looking into the future, experts see home computers that will pay bills , deposit paychecks, and allow shoppers to check the availability of an item without making a trip to the store. More overpasses at traffic intersections and scanners that can assess traffic flow and adjust signals accordingly will reduce gasoline wasted by idling automobiles.