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US highway travel down sixth month in a row

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Reuters / June 19, 2008

WASHINGTON—Americans drove less in April for the sixth month in a row, following record gasoline prices and a jump in the number of riders taking public transportation, new government data shows.

Americans drove 1.4 billion fewer highway miles, down 1.8 percent from a year earlier and 400 million miles less than in March, according to the US Transportation Department.

The high cost of gasoline has cut highway travel almost 20 billion miles, or 2.1 percent, during the first four months of this year, the department said. Highway travel is down nearly 30 billion miles since last November.

Rural areas, where families drive more and spend a larger share of their income on gasoline, have seen the biggest decline in highway travel.

Travel on rural interstates for the January-April period is down 2.9 percent and off 3.1 percent on other rural highways.

A new report on Thursday from an energy advisory group reflected the drop in total highway travel, saying U.S. gasoline demand may have peaked last year and will likely decline in 2008 for the first time in 17 years.

Cambridge Energy Research Associates said long-term shifts in consumer behavior, such as buying more fuel-efficient vehicles, is helping to push gasoline demand lower.

"Americans are now driving less and demanding greater fuel efficiency from their vehicles when they do drive," said Aaron Brady, CERA's global oil director.

Sales of mid-size sport utility vehicles fell 38 percent last month compared to a year earlier. Sales of better mileage passenger cars, which were less than half of all vehicle purchases last year, jumped to 57 percent in May.

The downside for the government is less money to pay for highway projects and public transportation, which is funded by an 18.4 cents-per-gallon gasoline tax and a 24.4 cents-per-gallon diesel fuel tax.

"As positive as any move toward greater fuel efficiency is, we need to make sure we have the kind of sustainable funding measures in place to support needed highway and transit improvements well into the future," said Acting Federal Highway Administrator Jim Ray.

CERA said gasoline prices still do not cause as much economic hardship as they did during the 1980s, but they are getting close to the "pain point" of just over $4.20 a gallon for an average annual price.

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