Gas Prices Take Their Toll on Area Consumers

July marked the first time ever that Kansas City area drivers put $4-a-gallon gasoline in their vehicles. As of this writing, the average cost of regular gasoline in the metro is $4.04 a gallon. Many residents have little choice but to pay this price to fuel their cars so they can get to and from work and run their errands.
It wasn’t that long ago that gasoline was around the $2-a-gallon mark (January 2007). The increased money going into the gas tanks has undoubtedly put the brakes on normal spending habits.
Kansas City residents, on average, are going to feel the pinch of gas prices a bit more due to the fact we have to drive a bit farther to get around than in other cities. According to the Center for Neighborhood Technology (www.cnt.org) the average Kansas City household drives 16,596 miles per year. At $4.04 a gallon this comes to over $3,300 in gasoline a year. Or looking at it another way, that’s over $1,600 more a year than we spent on gasoline at January 2007 prices. By comparison, Denver area residents are now spending approximately $2,800 a year in gas, or $1,400 more than when it was $2 a gallon.
The additional money going towards gasoline has to come from somewhere, and consumers are likely to cut back on discretionary spending to make up the difference. This is clearly dampening the economy, as consumers are looking for ways to save money rather than going out and spending it.
We will continue to research consumer spending and hope to have more information in the coming weeks.