How will rising gas prices impact mobility?

Amid the ongoing conflict in Ukraine, gas prices are beginning to rise as Russian oil is cut off from the global market, which has reduced overall supply. As the Wall Street Journal notes in the article below, the U.S. saw the average price hit $4 per gallon on March 6, which was the highest price since 2008.

The price of gas is one of a number of travel-related costs on the rise. As Plus VP of Consulting Services Chris Pardo wrote about recently, airline tickets, rents, real estate costs and a number of other areas are climbing upward — and that’s increasing the overall price tag for global mobility services.

This begs the question: How will increased costs impact mobility volume? Chris touched on the idea of “fernweh,” or the intense desire to travel internationally. After dealing with so many travel restrictions the past two years, many people are itching to get on the move again. If this desire stays high enough, it could be enough to stomach the higher prices, though cost-conscious mobility programs could be swayed more by the bottom line than their employees’ wanderlust.

Specific to gas prices, the Wall Street Journal article notes that experts are divided on whether the steeper costs will discourage road trips throughout the U.S. Michael Tran, managing director of global energy strategy at RBC Capital Markets, echoed the idea of “fernweh” and said he expects Americans to hit the road despite the price increase.

Another factor in play: The rise in hybrid and electric vehicles. Obviously, drivers who need less gas are also less affected by the rising prices. These types of cars were already growing in popularity in recent years, but they could become even more desirable while gas prices are elevated. Or, as I’ve written about before, we could see more people move away from relying on cars entirely.