Rising Gas Prices Dampen Consumer Purchasing

Columbus, OH, May 25, 2007–What happens when rising gas prices surpass consumer expectations? You get a decline in consumer confidence, an increase in the number of consumers who feel worse off than a year ago and a decline in the number of consumers who plan on buying consumer goods. All this is from BIGresearch’s May Consumer Intentions & Actions Survey (CIA) of 8,353 consumers.

 “Gas price increases have entered unchartered territory as consumers anticipated prices to reach $3.32 a gallon by Father’s Day. With prices for mid grade and premium gas topping $3.41 and $3.54 a gallon and $3.22 for regular according to AAA, consumers underestimated how high gas prices would go and are making changes to their purchase behaviors to cope,” said Gary Drenik, President & CEO of BIGresearch. “It’s tough for customers to think about making big ticket purchases and long-term debt obligations when daily budgets are being stretched to their limits with no end in sight,” said Drenik.

Purchase intentions in May for autos, furniture, appliances and major home improvement were all down from April.

People Planning on Buying (Next 6 Months)

                                                April                 May

Car / Truck                               11.6%               10.9%

Furniture                                  9.9%                 8.6% 

Home Appliances                     7.4%                 5.9%  

Major Home Improvements     10.5%                9.5%       

“Regarding your personal financial situation, compared to this time last year, are you…”

Better Off         22.8%

Same               43.9%

Worse Off         33.3%