Rising gas prices and a down economy are changing the climate and practices of local businesses, for better and for worse.
On two wheels
At Vancouver Cyclery, Owner Bob Sweet said the gas crisis is benefiting his business and the cycling industry overall.
“It’s obvious that the industry is busier than it’s ever been,” he said.
Bike sales were up between 20 percent and 40 percent during the last two years, and Sweet expects his shop to be flooded with business until late October.
While most commuters still aren’t biking to work regularly, Sweet said he has noticed more people choosing bicycles for recreation, exercise and short trips. That’s an improvement compared to the fuel shortage of the 1970s, when he said people went to great lengths to keep driving, waiting in line for hours at the pump.
“People are now thinking that a mile or two (on a bike) might not hurt,” he said.
On four wheels
At XRV and Eco Trailer Sales in Vancouver, Owner Frank Barocela said he sees a direct correlation between sales and gas prices.
The company sells lightweight recreational vehicles and camp trailers that can be towed by small vehicles without dragging down gas mileage.
Barocela said sales climbed in mid-May when gas prices increased almost daily, and May and June were record months for the company. As of July, the company made 44 sales – already 73 percent of all 2007 sales.
Barocela said he’s selling more to lower-income consumers and that interest in his products is similar to growing interest in hybrid electric vehicles.
“Before, some people wanted the trailers because they saved fuel,” he said. “Now, with the price of gas going crazy, everybody wants one.”
On the auto lot
But elsewhere, the rising cost of fuel is causing a painful pinch.
At Westlie Ford-Mercury Inc. in Washougal, Sales Manager Steve Elerick said overall sales are down and that larger vehicles have been harder to get off the lot since gas hit $3.50 a gallon in March.
“In the auto industry, unfortunately, (decreased sales) are a given,” Elerick said. “We haven’t plummeted by any means, but sales have declined.”
Slowdowns in housing and residential construction also have affected auto sales, he said.
“The fleet business has been affected,” Elerick said. “We sell to a lot of contractors and they’re not buying vehicles. They aren’t building right now to the magnitude that they were.”
On the delivery side
Joel Padley, owner of Petals floral shop in Vancouver, has made a point of not charging delivery fees since opening in 1999.
“I’m holding on hard,” he said.
He charges $10 to $12 for delivery to outlying areas, such as Camas and Battle Ground, but in Vancouver, free delivery has boosted sales. By charging delivery fees, Padley’s customer base could drop 5 percent, he said.
Padley spends at least $500 each month on delivery fuel and is feeling that expense more with the slow economy. Petals’ profits have dropped between 15 percent and 20 percent since May, even in wedding season.
“July is just dried up,” he said. “If I weren’t out hustling business, it would be pretty tough.”
If gas rises to $5 a gallon, Padley said he would consider charging $4 per delivery, which he said is lower than competitors’ $7 or $8 fees.
“I’m fairly established, so I’m worried about profit margins, but not about going out of business,” he said. “You have to stay on your toes.”
Saving public dollars
Public agencies are feeling the pinch much like the private sector.
Fuel prices are stretching C-Tran’s budget, which was set when diesel cost $3.50 per gallon – or $3.10 per gallon at C-Tran’s discounted rate. Now it costs almost 23 percent more and the biodiesel used by 5 percent of the fleet is usually within a nickel of the price of diesel, said Scott Patterson, director of development and public affairs.
Ridership was up 16 percent between January and May, compared to the same period last year, and express ridership to downtown Portland was up more than 23 percent, Patterson said.
“Once gas hit $3.50 (per gallon), you could see incremental changes in ridership,” Patterson said. “Today you see more.”
Although the agency increased fares in May, more riders haven’t meant more cash because C-Tran pays more for opperating costs.
The agency added 12 hybrid electric buses to its 118-vehicle fleet July 15 to save money on fuel and maintenance long-term. Each cost about $200,000 more than a typical diesel coach, which cost about $375,000.
Meanwhile, Clark County Public Works employees are using less fuel thanks to a recent schedule change.
Since June 16, the department’s 125 employees have worked four 10-hour workdays each week instead of five eight-hour days. The pilot program, which will continue until Nov. 2, could be revived next summer.
Operations Manager Greg Shafer expects the change to save the department $26,000 this summer alone. In 2007, the department used about 65,000 gallons of fuel in summer months.
The effort should help employees save about 20 percent on personal commuting costs.
Charity Thompson can be reached at cthompson@vbjusa.com.
