Texas downsizes

HOUSTON – There was a great old postcard that said "Welcome to Texas," and then, in smaller letters, "So Big!" And indeed it is. Driving from Houston out to the Hill Country, I was amazed that even the Wal-Marts were huge; did you know there were "Super Wal-Marts"? I saw a Methodist church the size and shape of a Home Depot store.

And, of course, the vehicles are also heroically proportioned, a grand parade of extended-cab super trucks and SUVs. Ever seen a Ford 150 SuperCab "King Ranch" with a 5.4-liter, 300 horsepower V-8? A Toyota Tundra Stepside Access Cab? A 3/4-ton Chevrolet Silverado 2500 crew cab with 6-foot bed? The roads are full of Cadillac Escalades and Texas-edition Nissan Titans (complete with chrome step rails and Texas Star floor mats). These things go to Texas to spawn.

I remember a Chevy spokes-man telling me in the mid-1980s, before the SUV phenomenon really got off the ground, that 30 percent of all Suburbans were registered in Texas. In 2004, R.L. Polk and Company reports, 57 percent of all vehicle registrations in the state were for SUVs and pickup trucks.

Here’s a state that consumes 240 million barrels of what the Beverly Hillbillies called "Texas tea" in a typical year, resulting in 48 million metric tons of carbon emissions. But things are starting to get a bit desperate in Texas these days, with people finally noticing that high gas prices are affecting them. Fourteen percent of Texans polled at Texasgasprices.com even say they’ve had their tanks siphoned! Eighteen percent are either canceling their vacations or cutting them short!

It can cost $100 to fill up a full-sized SUV at $2.30 a gallon, and the Wall Street Journal reports that Texans are having second thoughts about their mighty steeds. "Sales of large SUVs are falling in the Lone Star state," the story stated. In January and February, registrations of the huge Chevrolet Suburban and Tahoe (known as the "National Car of Texas") fell nearly 20 percent. At one Ford dealer, the unthinkable happened and an actual car, the new Mustang, outsold the F-150 pickup.

Obviously, Texas is not unique in this respect. Nationwide SUV sales fell 13.5 percent in the first quarter of the year, Ward’s Automotive Reports says. The largest SUVs lost the most ground, 28 percent for the Suburban/Tahoe duo and 25 percent for the Ford Expedition.

Texans go for the biggest SUVs, and their resale value is plunging. Within three years, large SUVs hold onto only 45 percent of their value, the Journal reports.

"The interest in gas-guzzler SUVs is more than just waning," says one desperate owner, trying without luck to sell his 1999 Suburban. "It has disappeared."

At this point, remember that General Motors’ recovery strategy is based on eager buyers snapping up its next generation of huge SUVs. If even Texans are switching to cars and crossover vehicles, that just isn’t going to happen.

Now let’s contrast this pathetic situation with the healthy market for used hybrids. I’m driving one of my favorite vehicles this week, the Honda Civic Hybrid. It might look like just another Civic, but under that hood is a sophisticated gas-electric powertrain that achieves 51 miles per gallon on the highway. Looking at online ads, I found a 10,000-mile 2003 Civic Hybrid that sold for not much more than $20,000 new for $17,500. It lost slightly more than 10 percent of its value in two years. For a 2004 model, they were asking $20,000. A new 2005 example of the hard-to-find Toyota Prius (list price $20,875) was offered on eBay with a reserve price of $27,000, and it had already been bid up to $25,350. It’s a seller’s market, if you’re selling the right thing.