ALEXANDRIA, Va. – Consumer optimism remains steady in April, a period
in which the ongoing spring transition to summer-blend fuel usually increases
gas prices and reduces optimism. While gas prices increased nearly another dime
over the past four weeks, 44% of consumers remain optimistic about the economy,
the same figure as March, according the latest monthly NACS Consumer Fuels
Survey that examines how gas prices affect consumer sentiment.
Last year, consumer optimism dropped 5 percentage points between
January and March, when gas prices peaked. This year, optimism increased from
43% to 44% since the beginning of the year, despite a 25-cent increase in
retail gas prices since January.
Strong demographic and regional variations could be seen in the latest
survey results. A majority (54%) of younger consumers — those ages 18 to 34 —
are positive about the economy, and fully half (50%) of those in the West are
optimistic. Meanwhile, consumers in the winter-ravaged Northeast and Midwest
are least optimistic, with only 41% in each area saying that they are
optimistic.
There are a few areas of concern in the latest results. Nearly two in
three consumers (63%) expect prices to increase over the next 30 days, the
highest percentage expecting higher prices since July 2013.
Also, consumers may be getting closer to changing their behavior if
prices continue to climb. The price at which consumers say that they would cut
back on driving was $4.05 per gallon, or 50 cents from what they say prices are
in their area. The price at which consumers would dramatically change their
behavior is $4.90, or $1.35 from what consumers say prices are in the area. As
these gaps narrow, the potential grows for changes in consumer behavior. Both
gaps this month are one-cent from the lowest reported in the last year, meaning
that further price increases could affect consumer behavior, as well as
sentiment.
Consumers’ self-reported miles per dollar decreased again in April,
dropping 3.3% to 6.71 miles per dollar, or 15 cents per mile. In 2014, NACS began
tracking this metric to gauge how consumer perceptions about their
self-reported mileage and gas prices might also affect their moods.
Every month, NACS conducts a nationwide survey in partnership with
Penn, Schoen and Berland Associates LLC to measure consumer perceptions about
gas prices and how they relate to broader economic conditions. For the April
survey, n=2,007 gas consumers were surveyed from April 1-3, 2014. The margin of
error for the entire sample is +/-2.19 at the 95% confidence interval and
higher for subgroups. The OPIS weekly national average price for gas was $3.547
on March 31, the week in which the survey was fielded. Summary results from
this and previous surveys can be found at www.nacsonline.com/gasprices.