Sunday, August 24, 2008

Small-car Burgh

News last week about the GM Cruze, the new small car that GM intends it make at it's (Greater Greater) Pittsburgh area Lordstown plant... just over the border in Ohio. Lordstown may not technically be in the Pittsburgh MSA, but it isn't far and is a big enough plant to have an impact on the local economy. So file this under 'Cleveburgh' posts.

I hate to sound a pessimist, but it's hard to shake the decision Volkswagen made to build the Rabbit in Westmoreland County following the gas crises in the 70's. That and I just saw a $3.20/gallon gas at the pump. It wasn't in Pittsburgh (I am away) but I really have to wonder how long before the energy mania is forgotten by many. That and it really puts in perspective the energy prognostications of even, or especially, the experts out there. I swear I heard someone last month say that even with some drop in oil prices the US consumer will never see $3/gallon again. There may be places in the US next week with market prices pretty close to $3/gallon.

There was grumbling when gas was $3/gal, but it was not really the news story that it was until gas prices peaked at over $4/gallon and looked to be accelerating upwards. If parts of the country are already back to $3.20 and possibly dropping... you just have to wonder.


Blogger EdHeath said...

My estimate is that the price of oil has fallen about twenty percent from it's peak. It's possible, but unlikely, that the price of gas had not caught up with the rise in the price of oil. It's possible, but unlikely (in my estimate) that the price of gas will drop further than the price of oil. Assuming that gas will track with oil, it should drop no further than $3.35, based on the current price of oil. I have heard the Saudis and OPEC will cut production, so that should halt the fall of oil prices. Still, even at $3.65 current regular gas price, I think a lot of the bicycles are going back into the basement.

Monday, August 25, 2008 7:00:00 AM  
Anonymous Anonymous said...

The sad part about VW closing the New Stanton plant, ending production in the US at the time, is that they are once again looking to build a plant here. This time it will be in Tennessee and produce VWs and possibly Porches and Audis.

Monday, August 25, 2008 5:51:00 PM  

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