Originally created 04/27/04

Consumers could feel pinch far from pumps



Consumers have been feeling the sting of higher gas prices at the pump, and they might start feeling it elsewhere too.

Businesses, which have been slow to pass their fuel costs on to consumers, might start raising their prices.

"We've been absorbing the higher costs, but we're going to have to start passing them on to consumers. We have no choice," said David Fields, the general manager of Radio Cab on Greene Street, which owns and operates 75 taxis.

In the past year, gas prices in the Augusta area have risen almost 30 cents, pushing prices to record highs, AAA reports.

Mr. Fields said he is sending a letter to the Augusta Commission, which regulates taxi fares, asking for permission to raise rates to cover his higher operating costs.

Few businesses are following Mr. Field's lead so far, instead trying to find ways to reduce fuel use and cut costs.

Knology, a cable and telecommunications company, has installed wireless dispatching systems into all of its 65 vehicles that organize house calls by location to maximize efficiency.

Drivers who take their trucks home with them are assigned to service calls near their homes.

The system helps reduce the number of miles each truck travels, said Mike Adams, the division manager for Knology's Augusta area.

"The dispatching system minimizes the cost, and that's why we really haven't seen much of an impact," he said.

John Dowdy, the owner of Five Star Moving Inc., has a similar, though simpler, plan - he asked his drivers to take the shortest route possible.

With six trucks in his fleet getting 5 to 6 miles per gallon, he estimates fuel to be 25 percent of his total cost.

The reduced driving has helped, but not enough.

"It's been devastating as far as profit, but you've just got to live with it. You can't price yourself out of business," he said.

Like many business owners, he is waiting for prices to get a little higher before raising rates.

The $2 mark, which many analysts predict will be reached this summer, seems to be the consensus point to adjust prices.

Johnny Gomillion, the owner of Cowboy's Limousine Service, said his business is running fine. But if prices hit $2, he said, he'll likely raise his rates.

And though Knology's technological investments have helped, Mr. Adams says he isn't sure how the company will respond to $2-per-gallon gasoline.

"If it goes up to $2 or $3 a gallon, we might see an impact," he said.

Staff writer Matthew Mogul contributed to this article.

Reach James Gallagher at (706) 823-3227 or james.gallagher@augustachronicle.com.