SUVs fall out of favor with rising energy costs

As gas costs hit consumers in the pocket, SUV dealers are starting to feel the pinch:

Salvador Sotello, for example, recently paid F.H. Dailey Chevrolet in San Leandro $41,000 for a new Chevy Tahoe LT (yes, with leather) SUV that had a sticker price of $58,000. The sale was an anomaly in what is otherwise a pretty dismal selling season. "It's been pretty quiet," saleswoman Crystal Gonzalez said the other day. "Been pretty slow."

At Broadway Ford in Oakland, the grilles of the Mustangs, SUVs and the lone Thunderbird smile at the passing traffic, but the showroom is empty, it appears, of customers; several salesmen are in sight. Up at Albany Ford-Subaru, salesman Myers Howard, sitting a few feet away from a big Ford pickup truck, says things on the Ford side of the showroom "are slow." That might be the understatement of the day.

Just this past week, General Motors Corp. and Ford Motor Co. underwent the humiliation of seeing their credit ratings reduced by Standard & Poor's Ratings Services to the status of junk. The reasons are becoming clear -- the two big companies can't sell much of what they produce.

The figures compiled by the auto industry research organizations are pointing this year at what is quickly becoming the white elephant of the industry -- that erstwhile favorite of the California shopping mall, the gas- sucking SUV, a highly profitable vehicle that was the darling of the 1990s but has now become the prime victim of $3-a-gallon gasoline.

Meanwhile, BMW is working on fuel-saving vehicles and, starting in a few years, a hydrogen-powered car. Perhaps there are too many X3s sitting on their lots?