Eight dollar a gallon gas has not driven Europeans out of their cars - they just
drive more efficient cars. In Europe 78% of personal travel transport is by private
car. All forms of mass transit, except airlines, have lost 20% or more in the last
20 years. (see previous pages). Europeans have abandoned mass transit, even with
$8/gal gas, why would anyone think Americans would flock to mass transit if gas prices
AAA puts the cost of driving at $0.51 per mile. The average car now gets around 25
MPG, so the cost of gas is only 16 cents per mile with $4/gal gas. That means that
gas is only about 1/3 the cost of driving. If it doubled to $8/gal, resulting in
32 cents per mile, the cost of driving would increase by about 30%. This is significant,
but not a killer.
Interestingly, AAA’s cost estimate is designed to simulate their upscale members
and thus is higher than the average American’s costs because AAA members drive much
newer cars than average. The difference is about $0.19 per mile.
This means that an increase in gas price of $4.35 per gallon (to about $6.75) will
just bring the average American’s cost to what is now the typical AAA member’s cost.
If gas really gets that expensive (inflation adjusted) many of us will just get more
efficient cars the next time we buy a car, negating the gas cost increase. This is
what the Europeans do (drive smaller cars) - why would anyone expect Americans to
give up cars due to gas price increase, when Europeans increase car usage at high
Why would anyone expect people to abandon the convenience of a car, instead of just
getting a smaller car? A smaller car is far more convenient than transit:
A factor that few people talk about is supply and demand.
As gas prices increase, people drive a bit less and get a more efficient car next
time that they get a car - that is the demand side: higher prices reduce demand.
Much oil is known, but has been too expensive to produce. For example, oil that costs
$40 per barrel will come on the market as the price goes above $40 per barrel. Examples
include Canadian oil sands, now ramping up production. Higher prices increase supply.
New sources become profitable and come into use. An example is oil from coal, an
old process not used because it previously cost too much. At today’s prices it is
very profitable and will soon contribute to our fuel supply.
Cars are heavily subsidized
One highly credible source, Access ( from the University of California Transportation
Center), published a paper by Mark Delucchi, in the spring of 2000 which studied
the costs not paid by the users (“external costs”) of various modes of transportation.
He found this:
External costs in cents per passenger mile:
GASOLINE AUTO.......5 to . 28.4 [6.9] (numbers in brackets are author’s best
ELECTRIC AUTO......8.8 to 24.8 [16.8]
TRANSIT BUS...........33. to 57 .. 
LIGHT RAIL...............27 to 109
HEAVY RAIL.............17 to 53
Bottom line: Cars have only 17% the external cost of Transit bus. Even less external
costs compared to rail.
(see PortlandFacts.com/Roads/Docs/Delucchi_Chart.htm for the chart & link to original
Cars cost about:
1/3 the cost of bus
1/6 the cost of streetcar
1/4 the cost of light rail when you include construction.