Rising pump prices becoming a US election issue

Fuel prices are hitting record levels across the US this month - thanks to reduced inventories, OPEC cuts in production and a…

Fuel prices are hitting record levels across the US this month - thanks to reduced inventories, OPEC cuts in production and a cold winter - its starting to become a sensitive issue in the presidential election.

So it was that Bill Ford, chairman and chief executive of the second-largest US carmaker, chose the Jacob Javitts Center to set the issue alight. He announced his support for higher fuel taxes in exchange for incentives to promote more energy-efficient vehicles.

Ford's views - not shared by other carmarkers - are likely to inflame the debate further.

"I would support some combination of gas tax - which I know is politically not that popular - and incentives [for fuel-efficient hybrids]," he told the New York Motor Show.

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Hybrid cars have been growing in popularity in the US since Toyota launched its Prius model. Fuel efficiency in general has fallen, however, because of the popularity of big-engined SUVs and trucks.

Yet for all the US media success of the likes of the Toyota Prius and the imminent arrival of the Ford Escape and Lexus RX400h, general economic commentators were not as won over by the plans. While the motoring press gave the car a warm welcome, hoping like the industry that it will ease the pressure on them from the green lobby, economists questioned the bottom line benefits.

According to one analyst on CNN, the only benefits of these hybrids were in town. "Once you get onto the highways - where most Americans put up their mileage - they're just normal gas guzzlers. The batteries only work in the city traffic." Perhaps the Ford Escape and its like are more designed to soothe car industry consciences than save the environment.