How are Canadians Reasonably Accommodating Gas Price Hikes? Canadian Consumer Reaction to the Rising Price of Fuel

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1 How are Canadians Reasonably Accommodating Gas Price Hikes? Canadian Consumer Reaction to the Rising Price of Fuel Jack Jedwab Association for Canadian Studies June 7, 2008 Highlights: -Majority of Canadians Report Cutting Back on Daily Driving -One-third say they are more frequently using other means of travel besides the car -Six in dollar consider changing to a more fuel efficient car -Canadians fare better in dealing with gas price hikes than Americans Like other consumers of gas across the globe, Canadians have either adopted or are contemplating various ways of dealing with the continued rise in prices. The most popular means by which Canadians have either responded to the situation or are contemplating a response is the object of a survey commissioned by the Association for Canadian Studies conducted by the firm Leger Marketing over the period May 21 st to 25 th. It is the first in a series of surveys that the ACS will undertake dealing with the relationship between the Canadian economy and national identity. Most of the questions put to Canadians were similar to those recently asked by the firm Gallup for USA Today in the United States. Conducted May 2 nd to May 4 th some 60% of Americans said they were cutting back significantly on their household spending to compensate for higher gas prices (only 38% said this when gas prices were shooting up three years ago). Americans most common strategy in dealing with fuel price rises has been to cut back on daily driving (mentioned by 84%). Some 5% of Canadians report cutting back on daily driving. Additionally, at least 7 in 10 Americans say they have taken steps to increase the gas mileage of the car they already drive. Less than five ten Canadians have done so. At least half of Americans cite carpooling, forgoing customary road trips, and cutting back on their household spending as things they are doing to deal with the rise in gas prices. Less than one in four Canadians has pursued each of these strategies. Similar shares of Canadians and Americans (each under one-third) have opted for other alternate modes of travel. As revealed below the most common strategy adopted by Canadians has been to cut back on daily driving and this followed by taking steps to increase the gas mileage of their automobiles.

2 Table 1 The next questions are asked on behalf of the Association for Canadian Studies. As a result of the recent rise in gas prices, did you either take the following actions, considered them or not considered them? Did Maritimes QC ON MB/SK AB BC Cut back on daily driving Taken steps to increase gas mileage your car gets More frequently used other means of travel besides car Shared rides with friends or neighbours Cut back significantly on your household spending Decided against taking a trip that you have taken regularly in previous years Change your vehicle for a more fuel 17.3 (1)

3 efficient car (1) Some 44.4% of Canadians say they are considering the idea of changing their vehicule for a more fuel efficient car Table 2

4 Table 3 Comparative results of Leger Marketing Survey for the Association for Canadian Studies and Gallup Poll for USA Today (Canadians and Americans with Automobiles) Did Cut back on daily driving Taken steps to increase gas mileage your car gets More frequently used other means of travel besides car Shared rides with friends or neighbours Cut back significantly on your household spending Decided against taking a trip that you have taken regularly in previous years Change your vehicle for a more fuel efficient car or considered United Canada States % % 71%

5 doing so Income is surely the most important consideration influencing the response to the rise in gas prices on the part of North Americans. Although the differences in response on the basis of income are somewhat more pronounced in the United States than Canada everyone seems to be affected to some degree by the rise in gas prices. In Canada and the United States the wealthiest segments of the population are the least likely to cut back on household spending as well as cutting back on daily driving and increasing gas mileage. However the income gaps are not as wide when it comes to employing other means of travel. Table 4 The next questions are asked on behalf of the Association for Canadian Studies. As a result of the recent rise in gas prices, did you either take the following actions, considered them or not considered them? Did Less than 20k 20-39k 40-59k 60-79k 80k+ Cut back on 41% daily driving Taken steps to increase gas mileage your car gets More frequently used other means of travel besides car Cut back 23% significantly on your household spending Shared rides with friends or neighbours Decided against taking a trip that you

6 have taken regularly in previous years Table 5

7 Appendix Detailed Regional and Socio-Economic Status and Gas Price Responses (Respondents both with and without automobiles) B1 QJ1A Cut back on daily driving Province Martimes QC ON MB/SK AB BC pondéré : absolu : DID 41% 50% 33% 43% 41% 42% 45% CONSIDER 25% 35% 21% 26% 35% 26% 19% 15% 12% 15% 14% 18% 19% 17% 19% 3% 32% 17% 6% 13% 20%

8 B1 QJ1B Taken steps to increase gas mileage your car gets Province Martimes QC ON MB/SK AB BC pondéré : absolu : DID 37% 29% 48% 35% 40% 36% 29% CONSIDER 27% 33% 17% 31% 31% 21% 32% 18% 26% 12% 17% 17% 27% 18% 18% 12% 23% 17% 12% 16% 21% B1 QJ1C Change your vehicle for a more fuel efficient car Province Martimes QC ON MB/SK AB BC pondéré : absolu : DID 12% 12% 13% 11% 19% 11% 11% CONSIDER 31% 35% 30% 30% 30% 34% 29% 36% 39% 29% 38% 37% 38% 38% 21% 14% 28% 20% 14% 17% 23%

9 Shared rides with friends or neighbours Province Martimes QC ON MB/SK AB BC pondéré : absolu : DID 22% 18% 16% 24% 22% 17% 30% CONSIDER 16% 16% 17% 14% 20% 21% 11% 38% 36% 36% 38% 40% 38% 40% 25% 30% 31% 25% 17% 24% 19% B1 Province Martimes QC ON MB/SK AB BC Cut back significantly on your household spending pondéré : absolu : DID 23% 39% 11% 26% 19% 26% 30% CONSIDER 25% 29% 20% 32% 31% 17% 19% 39% 26% 45% 33% 44% 52% 38% 13% 7% 24% 10% 6% 5% 13%

10 B1 Province Martimes QC ON MB/SK AB BC Decided against taking a trip that you have taken regularly in previous years pondéré : absolu : DID 20% 24% 13% 23% 15% 24% 17% CONSIDER 23% 26% 19% 24% 26% 29% 19% 34% 28% 36% 34% 32% 31% 37% 24% 22% 33% 19% 26% 16% 27% B1 QJ1G More frequently used other means of travel besides car Province Martimes QC ON MB/SK AB BC pondéré : absolu : DID 27% 20% 28% 28% 22% 25% 29% CONSIDER 22% 22% 16% 23% 30% 29% 19% 35% 33% 36% 31% 42% 35% 40% 17% 25% 20% 18% 6% 11% 12%

11 B2 QJ1A Cut back on daily driving 20-39k 40-59k 60-79k 80k+ Refusal pondéré : absolu : DID 41% 50% 42% 45% 34% 41% CONSIDER 25% 14% 31% 25% 33% 25% 15% 12% 11% 19% 25% 12% 19% 24% 15% 12% 8% 22% B2 QJ1B Taken steps to increase gas mileage your car gets 20-39k 40-59k 60-79k 80k+ Refusal pondéré : absolu : DID 37% 38% 39% 43% 36% 29% CONSIDER 27% 24% 27% 25% 32% 32% 18% 14% 18% 20% 24% 15% 18% 24% 17% 12% 8% 23%

12 B2 QJ1C Change your vehicle for a more fuel efficient car 20-39k 40-59k 60-79k 80k+ Refusal pondéré : absolu : DID 12% 9% 11% 10% 18% 12% CONSIDER 31% 36% 31% 34% 34% 20% 36% 28% 35% 41% 40% 41% 21% 27% 23% 15% 8% 27% QJ1D Shared rides with friends or neighbours 20-39k 40-59k 60-79k 80k+ Refusal pondéré : absolu : DID 22% 26% 17% 21% 19% 23% CONSIDER 16% 12% 17% 16% 20% 9% 38% 32% 38% 40% 49% 33% 25% 29% 27% 22% 12% 34%

13 B2 QJ1E Cut back significantly on your household spending 20-39k 40-59k 60-79k 80k+ Refusal pondéré : absolu : DID 23% 32% 30% 25% 14% 20% CONSIDER 25% 29% 24% 23% 30% 24% 39% 29% 37% 44% 51% 33% 13% 10% 8% 8% 5% 23% B2 QJ1F Decided against taking a trip that you have taken regularly in previous years 20-39k 40-59k 60-79k 80k+ Refusal pondéré : absolu : DID 20% 20% 22% 26% 16% 16% CONSIDER 23% 25% 30% 22% 22% 22% 34% 27% 32% 36% 46% 30% 24% 28% 16% 16% 16% 32%

14 B2 QJ1G More frequently used other means of travel besides car 20-39k 40-59k 60-79k 80k+ Refusal pondéré : absolu : DID 27% 33% 27% 25% 25% 25% CONSIDER 22% 22% 23% 20% 24% 17% 35% 26% 36% 41% 41% 34% 17% 19% 13% 15% 10% 24%