Summary of Key Points
After the increase in oil prices, the retail prices of many goods (such as bottled water, clothing, and freight) have not risen. However, this is not a good sign. The middle parties (factories, logistics companies, and retailers) are silently bearing the pressure of rising costs, leading to issues such as decreased profits, reduced production, and even overloading of vehicles. Only a few goods with no price benchmarks, short supply chains, and inelastic demand (such as condoms and tires) have actually seen price increases. This phenomenon of "prices remaining unchanged, but living standards worsening" is due to the concept of "price stickiness" in economics. While this crisis also presents opportunities for the transition to new energy trucks, the transition itself is fraught with difficulties.
1. Why Don’t Most Prices Rise Despite Higher Oil Prices?
The key reason is "price stickiness"—商品 prices seem to be fixed in place and do not immediately increase with rising costs. There are mainly three situations:
- Long supply chains that prevent cost transmission: For example, the process of producing clothing involves multiple intermediaries (from oil to polyester chips, fibers, fabric, finished garments, to branded products), each of which fears losing customers if prices rise and thus bears the cost increase. For instance, a polyester fiber manufacturer with no inventory has no choice but to raise prices, only to see business taken over by competitors with inventory, forcing them to shut down some of their production lines.
- Existence of "price benchmarks" that prevent price changes: Goods like bottled water have established prices (e.g., $1 or $2 per bottle). If a convenience store owner increases the purchase price by $2-$3 per box, customers will refuse to buy, preferring to earn less than nothing.
- Fierce competition that makes price hikes detrimental: This is especially true in the logistics industry, where there are millions of small companies nationwide. For a route from Jinan to Guangzhou, there might be 20-30 competing logistics providers. Since oil costs account for about 30% of logistics expenses, any company that raises prices first loses business, so they remain unchanged.
2. Who Bears the Cost of Unchanged Prices?
Although retail prices have not increased, the producers in the middle chain are struggling:
- Factories reducing production or profits: Manufacturers may shut down lines, and fabric suppliers cut profits, affecting the entire supply chain.
- Logistics drivers overloading vehicles: Logistics companies pay drivers a few cents per kilometer. To earn more, drivers illegally overload their trucks (4.2-meter blue-label trucks carrying four to five tons, 4.5-ton yellow-label trucks carrying thirteen to fourteen tons), increasing the risk of accidents on the roads.
- Indirect impact on ordinary people's incomes: If you work in a clothing factory or as a logistics employee, reduced industry profits will affect your wages or commissions, as every consumer is also a producer.
3. Which Goods Have Actually Seen Price Increases?
Only three types of goods can successfully raise their prices:
- Goods without price benchmarks: For example, condoms, for which there is no established price perception, so a small increase is not considered unreasonable.
- Short supply chains: These goods (such as tires) can be produced in one factory, allowing cost increases to be directly passed on to consumers.
- Inelastic demand: These products are essential; if they break or need to be replaced, customers will still buy them.
4. Hidden Consequences of Unchanged Prices
Besides reduced producer incomes, there are other unseen changes:
- More cautious consumption: With lower profits, retailers may reduce inventory levels or cut quality (although not explicitly stated, they might use cheaper materials).
- Increased safety risks: More overloaded trucks mean a higher likelihood of accidents.
- Greater psychological stress: Both bosses and employees are struggling to maintain operations (factories trying to stay open, drivers working harder), making life more difficult than before.
5. Opportunities in the Crisis: Can New Energy Trucks Provide a Solution?
High oil prices are forcing the logistics industry to transition to new energy trucks. The penetration of new energy vehicles in heavy-duty transport has already reached 30%, and this figure is expected to rise further if oil prices continue to climb, potentially reducing transportation costs at the source. However, the transition is challenging: A new energy truck with a large battery can cost over $200,000, and drivers need to drive for a long time to recoup the investment, so many are choosing to wait rather than make the switch immediately.
In conclusion: The fact that prices of most goods have not risen despite higher oil prices is not due to kindness on the part of merchants but because the middle parties are bearing the burden. Behind this apparent stability lies a decline in income and hidden risks for many people. The pressures of life do not disappear just because prices remain unchanged.