Wire: BLOOMBERG News (BN) Date: 2008-07-28 15:52:25
U.S. Driving Falls Again, Heralding 1st Annual Drop Since 1980


By Angela Greiling Keane
July 28 (Bloomberg) -- U.S. motorists, paying record prices
for gasoline, drove less in May for a seventh consecutive month,
pointing toward the first annual drop in travel by road since
1980.
``$4 per gallon may have been the trigger point we've been
looking for,'' said Kenneth McGill, managing director for travel
and tourism at consulting firm Global Insight Inc. in Lexington,
Massachusetts. ``It's interesting to see Americans finally
reacting to the price of gasoline by rationing consumption.''
Vehicle-miles traveled on all U.S. roads fell 3.7 percent
in May from a year earlier, the Federal Highway Administration
said in a report today. The seven-month slide is the longest
streak since 1979, agency spokesman Doug Hecox said.
Americans cut back as the average U.S. retail gasoline
price reached a then-record of $3.98 a gallon on May 31. Rising
fuel prices and a weak economy also marked the drop in driving
in 1980, after the Soviet Union invaded Afghanistan and U.S.
Embassy personnel in Iran were taken hostage.
May's travel decline pushed this year's total down 2.4
percent, according to the highway agency, which has been
reporting the data since 1942.
Driving decreased in all five regions for which the
Washington-based agency reports results, led by a 4.5 percent
drop in the north-central U.S., which includes Chicago.
The traffic counts are compiled using cables across
roadways to estimate the number of miles driven. The agency
tracks all motorized vehicles and doesn't differentiate between
commercial and passenger traffic.
Gasoline at U.S. pumps averaged as high as $4.11 this month
before slipping to $3.96 yesterday, according to motoring group
AAA.
That drain on consumers' wallets also is helping damp U.S.
auto demand, which Deutsche Bank AG said July 23 may shrink to
14 million vehicles this year, the fewest since 1993. First-half
sales fell 10 percent, with light trucks down 18 percent.