From the August 9, 1906 NYT:

The automobile is largely responsible for several noteworthy disturbances in the commodity markets. It lifted the price of rubber to an almost intolerable figure for the common uses. Gasoline is another commodity whose price has soared under the auto demand. Prices of leather are now reaching record figures...the price of "spready steer hides" advanced last week to 17 1/4 cents, while during the paper-money inflation period of the civil war the highest price reached was 14 1/2 cents, which had stood as the high record in all the succeeding years until now. We may have to go without rubbers or rubber coats, and we may have to go without boots or shoes, but we must have our automobiles.

There seems to be an undercurrent of the same sentiment directed towards the American car owner and his/her seemingly insatiable appetite for things mobile. If only we didn't demand to drive, the price of gasoline would fall, the price of other goods would fall, and life would be so much more wonderful. Yet the argument implicitly assumes that all uses of an input are created equally, and that is simply not true.

If the price of gasoline increased with the advent of the car was it because the car conveyed more market power to the gasoline manufacturer? Not likely. It is more plausible that the car made gasoline more valuable to the end consumer, i.e., the end consumer was willing to pay more for gasoline given its new use.

Before the car gasoline was, perhaps, only used for light and heat. However nice light and heat, the ability to motor across the countryside was and is a very valuable alternative use of the same product. Doing away with the car, whether in 1906 or 2006, might reduce the prices of certain inputs such as gasoline and rubber. Yet, such price reductions would partly reflect the reduced value of these inputs to the end consumer.