New Motorcycle Sales Increase in Response to Rising Gasoline Prices

Purpose: We examine the empirical relationship of gasoline prices on new motorcycle sales and, consequently, motorcycle fatalities in the U.S.

Methods: Motorcycle sales and fatalities data come from the Motorcycle Industry Council (MIC) and Fatality Analysis Reporting System (FARS), respectively. Gasoline prices are provided by the Energy Information Administration (EIA), and are adjusted to 2009 dollars. The study period is from 1984 to 2009. Autoregressive integrated moving average (ARIMA) regression is used to model the relationship of gasoline prices with sales and fatalities.

Results: Our data show that new motorcycle sales are positively correlated with gasoline prices (r=.78). When inflation-adjusted gasoline prices increased by 117% from 1999-2008, we estimate that this was associated with an increase in motorcycle sales of 528,000. However, results from ARIMA regression analysis suggests that the rise in gasoline prices after 1999 and consequent increase in new motorcycle sales resulted in 438 additional motorcycle fatalities. In contrast, the decline in gasoline prices by 92 cents in 2009 is predicted to have resulted in 151 fewer fatalities in that year—a 31% decrease in fatalities from the prior year.

Conclusions: Our study findings suggest that, in response to increasing gasoline prices, people may be more likely to purchase new motorcycles. Rising gasoline prices is associated with increased motorcycle sales and, consequently, increased fatalities from motorcycling. Raising awareness of the risks of motorcycling, enhancing licensing and testing requirements, and developing mandatory training programs will help to ameliorate the increased popularity of motorcycling as gasoline costs rise.