Last January, I bought a new car after months of dithering over the possibilities. I ended up buying a 2006 BMWXiT. Having written a book about BMW, I was pleased to own my first Bimmer.

That was then. With fuel economy rated at 16/26, I figured I would get an average of 22mpg. Not a chance. But it’s not all BMW’s fault. The fact is that a car so well tuned for speed is impossible for me to keep under 75-80 mph on the highways I normally travel. That puts my combined gas mileage around 16-18 combined. Ouch. It’s gotten to the point where I can’t even enjoy driving the car knowing how fast I am burning gas at $4.25 a gallon. When I drive, I can hardly take my eyes off the gas gauge.

So, I have decided to trade it in for something much more economical. So far, though, it’s not going well. I stopped at my Honda dealer, from whom we bought a 2004 Odyssey minivan. I was seeking a Honda Fit, which will net me over 30 mpg. He is out of them. I hear it will be a six week wait, at least. Worse, the dealer tells me that the auction price for my BMW is about $2k less than I paid for it in January, and $2k less than says I should be able to get in a trade. I thought I had gotten a great deal on the car back in January. Not so much.

Indeed, auto sales are going to be severely impacted in the coming months by car owners’ iniability to trade in their vehicles without losing big money. My Honda dealer told me that the auction prices for Odyssey minivans had dropped $3,000 in just two weeks. Two weeks!!And that’s a Honda, whose resale values have held up better than almost anyone’s. Imagine if you own a Chevy Trailblazer or Ford Explorer, and took out a six year loan three years ago. Forget it. You are stuck with that baby until it is paid off, and probably beyond.

Two weeks ago, Ford said that it had seen a tipping point with the American consumer when gas went passed $3.50 per gallon. That seemed to trigger people laying off vanity purchases of trucks and SUVs. The shame of this is that we couldn’t, as a country, get behind gas taxes after 9-11 that would have driven gas prices up right away. That tax revenue could have been used to speed infrastructure and investment in new sources of energy for transportation. It could have been used to subsidize some new and badly needed investments in mass transit. It could have been earmarked to subsidize conversion of power plants to cleaner technology. Instead, the steady escalation of oil prices has simply lined the pockets of oil states and speculators.

My BMW is listed for sale. I’m going to see how close I can get to the original buying price, but I’m prepared to take a hit. If I drive my next car—a Fit, Focus or Versa—closer to 65 mph, my annual savings will be around $1400-$1500 per year. Since I figure to own the car for seven or eight years, that will add up. Insurance will be cheaper too. When I get the new wheels, my eyes will still be fixed on the fuel indicator, but this time it will be to see how far I can go before the needle moves off Full.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE