What will spur change in the energy industry? Gas that costs more than your car?

I was driving around yesterday and got to thinking... with the rising price of oil due to shrinking supply and rising demand, we'll soon realistically see gas prices in the $5 to $6 per gallon range. Some Americans will scoff, but as many people have pointed out, Europe's been above this level for a long time. At that level, we can see from some pretty standard calculations that the gas will cost more than the car over the life of the car.








And if we slightly modify some of those assumptions, we see a dramatic shift where the fuel now costs nearly 3X what the car cost.








Prices such as these would look more like the razor blade model, where you get the razor for cheap, but the company nails you when you buy the blade refills for 12 bucks. Come to think of it, if I were an oil company I'd launch a series of ads showing just how sexy and cool these un-economical cars are... you know, distract people from the fact that they're paying more for the fuel than the car.

But I think consumers are smart, and while they've already begun to wake up, they'll REALLY wake up when gas hits $6/gallon. And I do believe demand for electric cars, not just hybrids, will begin to come from the bulk of society, not just the "green fringe."

And that's really where we have to go on this issue. Change will have to come because it makes economic sense to the consumer. I fear we're living a pipe-dream if we think that consumers will think 30 years into the future and make a choice that hurts them economically today. They have to feel some pain so that the better choice becomes the economical choice, and vice versa. Unfortunately, we'll see just how much pain we have to endure first.