Transport fuel prices have been rising over the past few years. In mid-2008, fuel prices reached unprecedented levels, peaking in July with regular petrol reaching $2.18 a litre.
Has this led to a change in the way New Zealanders travel?
Vehicle kilometres travelled (VKT) data for 2008 shows that there was a drop in the total distance travelled in 2008. This, combined with changes in public transport use and reported reductions in traffic volumes suggests the answer is ‘yes’.
Significant increases have been observed in public transport use in the main centres during 2008:
Public transport trends in the main centres are indicative of what is happening around the rest of the country. Nationally, there was a 4 per cent growth in public transport boardings for the year to June 2008 compared with the previous year.
While the link between fuel prices and total public transport boardings over the past seven years seems weak, uptake of public transport is influenced by a number of factors, including convenience, capacity, reliability and the relative cost of public versus private transport. Fuel price rises may also cause shifts to other forms of transport, such as cycling and walking.
(1) Petrol prices are annual average prices based on the calendar year. The average for 2008 includes prices up to 14 November.
(2) Public transport boardings include bus, train and ferry totals, and are based on a year from July to June.
Data sources: Ministry of Economic Development and Ministry of Transport.
Fuel price increases also affect New Zealanders’ vehicle choices. A 2007 report found that an early response to increasing prices was to reduce fuel consumption by shifting to smaller, more fuel-efficient vehicles. In the first three quarters of 2008, the fuel efficiency of vehicles being registered in New Zealand improved slightly for both new and imported vehicles for the first time. This was accompanied by an increase in the sale of New Zealand-new small and light vehicles, and a corresponding drop in large vehicle sales. New sports utility vehicle sales also dropped by 10 per cent in 2008, after increasing by 20 per cent between 2006 and 2007.
Between July and November 2008, however, transport fuel prices dropped significantly. The price of regular petrol fell by a third, to $1.45 a litre – its lowest level for the year. As a result, an immediate upswing in traffic volumes was observed throughout New Zealand, with national traffic figures for October 2008 only 1.6 per cent below figures for October 2007.
Return to total VKT page.
Last updated: March 2009