How the 1973 Oil Crisis Changed Motoring

Since the end of the 1940s, cars had been getting progressively more powerful, but the 1973 oil crisis changed all that. The world’s car companies put their collective brakes on. A global oil shortage did more than just send shockwaves through the world’s petrol stations, it catalysed a paradigm shift in the design, engineering, and perception of cars.

Automotive History
13 September 2023

During the 1973 oil crisis, effects on cars were immediate. Instantly, drivers felt the pinch. Long queues at petrol stations became a common sight, as did soaring fuel prices. With the spigot tightening, it became clear that thirsty, big-engined cars would struggle to continue as the predominant force on the roads. There was an urgent, palpable demand for vehicles that consumed less petrol, a realisation that efficiency and conservation weren’t just ideals, but necessities.

The oil crisis and motoring were not happy bedfellows, but how did the 1973 oil crisis change motoring? Let’s take a ride through history and find out.

The Price of the 1973 Oil Crisis

Cars queuing for petrol, December 1973 (Credit: Evening Standard/Hulton Archive via Getty Images)

In the immediate aftermath of the embargo placed on the supply of oil, petrol prices skyrocketed. A litre of petrol in the UK in early 1973 was relatively low, somewhere around seven pence.

As the crisis took hold, global oil prices quadrupled, and this had a direct and dramatic effect on petrol prices at the pump. By the end of the crisis, UK petrol prices had roughly doubled. By 1974, the price per litre was somewhere between 11 pence and 15 pence.

Similarly dramatic increases in the cost of a barrel of crude oil were seen all over the world. Just before the 1973 energy crisis, a barrel of crude cost between £1.15 and £1.67 ($3 – $4). During and after the crisis the cost went up to between £3.85 and £5 ($10 – $12).

It’s crucial to contextualise these figures from the 1970s. While these prices might seem incredibly low by today’s standards, when adjusted for inflation and the purchasing power of the time, they were quite impactful. The sudden and sharp rise in prices was felt deeply by households, businesses, and the broader economy. This was the true cost of the crisis.

The price increase would be the approximate equivalent of a tank of petrol costing £80 today, but by next weekend costing over £160.

The 1973 Oil Crisis Effects On Cars

A BP petrol pump during the 1973 oil crisis (Credit: Evening Standard/Hulton Archive via Getty Images)

Over time, the ripples of this oil-induced sea change reshaped the car industry. Engine designs were revolutionised, emphasising fuel efficiency and smaller displacements.

The era of utilitarian runabouts we affectionately call superminis dawned, offering drivers the same freedom of the open road, but with the promise of more miles in the tank. We also saw the evolution of the hot hatch. Sales of small cars like the Mini, Audi 50, Ford Fiesta, Fiat 127 and Renault 5 soared, while sales of the thirsty big-engined Mercs and Jags dwindled, at least for a while.

Globally, there was also a surge in popularity for famously fuel-efficient Japanese cars from Toyota and Honda, which found new markets in the US, Europe and elsewhere.

Beyond just the mechanics, the very soul of motoring began to transform. The emphasis on pure power made room for a renewed appreciation of sustainability, prompting research into alternative fuels and technologies. Research that continues apace today.

How did the UK Car Industry Fare?

Fuel ration coupons during the 1973 oil crisis (Credit: Evening Standard/Hulton Archive via Getty Images)

The ramifications of the oil crisis and motoring in the UK were multifold, with both immediate and longer-term consequences. Famously, as the 1973 energy crisis was about to chokehold the British car industry, Jaguar launched their 5.3-litre V12 XJ-S. While early sales were understandably poor, it nevertheless went on to become one of the best of all 1970s Jaguars.

The Instant Impact on Fuel Availability

Much like in other parts of the world, Britain experienced fuel shortages. The government even went as far as to implement rationing measures, similar to those during World War II. While ration books were produced, they were never officially used as the situation eased before it became necessary. However, their mere presence was an indicator of the level of concern of the government and the wider car industry.

The Shift in Consumer Preferences

Before the 1973 oil crisis, the UK car industry was best known for its luxury saloons and sports cars, from brands like Jaguar, Rolls-Royce, Lotus and MG. However, the sudden spike in petrol prices and concerns about availability made consumers rethink their preferences. There was a notable shift towards smaller, more fuel-efficient vehicles. British Leyland’s Mini, launched in 1959 and already immensely popular, saw a further boost in its appeal due to its efficiency.

The Strain on an Already Straining Industry

The 1973 energy crisis, combined with pre-existing economic challenges and increasing competition from manufacturers in Japan, Italy and Germany, placed considerable strain on the British car industry. Companies like British Leyland, already facing labour issues and financial troubles, were further burdened by the changing dynamics of the global car market.

A Reason to Innovate and Change Philosophy

Some answers to the question how did the 1973 oil crisis change motoring weren’t tinged with negativity. In response to the crisis itself and quickly changing consumer demand, British car makers began to invest more in research and development to produce fuel-efficient vehicles. This was a seismic shift away from larger, more powerful engines to more compact and efficient designs. Cars became more aerodynamic, and there was a renewed focus on engine efficiency.

The Changing Face of the British Car Industry

Leyland Motor Corporation logo (Credit: Mike Kemp via Getty Images)

The UK car industry underwent significant transformation in the latter half of the twentieth century. While the 1973 oil crisis wasn’t the sole reason for these changes, it was among the pressures that hastened shifts in the industry.

British Leyland

A major force in the UK car industry, British Leyland formed in 1968 as the result of a merger between Leyland Motor Corporation and British Motor Holdings. By the 1980s, partly precipitated by the 1973 oil crisis, the company was broken up, and its various brands were either discontinued, sold, or changed hands multiple times. The Rover Group, one of its successors, was eventually sold to BMW in 1994. The MINI brand is now under BMW, while MG was eventually acquired by China’s SAIC.

Jaguar and Land Rover

Both originally part of British Leyland, these iconic brands changed hands multiple times. Jaguar was separated from British Leyland in the early 1980s, later becoming independent, and was then acquired by Ford in 1989. Land Rover was also bought by Ford in 2000. Eventually, in 2008, both brands were sold to Tata Motors, an Indian multinational company.

Rolls-Royce Motors

While Rolls-Royce is synonymous with British luxury, it went through its own share of challenges. The automotive division was acquired by Vickers in the 1980s and then by Volkswagen in 1998. However, due to a complex deal, while Volkswagen acquired the factory and the ‘Spirit of Ecstasy’ logo, BMW acquired the rights to the name and the brand’s iconic grille shape. Since 2003, BMW has been producing Rolls-Royce cars.

Aston Martin

Another iconic British brand, Ford took a stake in Aston Martin in 1987 and gradually increased its ownership share. Ford divested its stakes in pieces between 2006 and 2013. The brand is now backed by a consortium of investors.


Known for its sports cars and racing heritage, Lotus was acquired by General Motors in 1986. It was later sold to Proton, a Malaysian carmaker, in 1996. Lotus is currently majority-owned by Geely, a Chinese automotive company.

It’s difficult to fully quantify the effect the 1973 energy crisis had on these and other car businesses around the world, but one thing became obvious through the years of change. The upheaval pushed weaker companies to the brink – forcing closure or acquisition – while it also served as a catalyst, pushing the automotive industry towards innovation, adaptability, and a renewed focus on fuel efficiency. This would define the trajectory of vehicle design and manufacturing for decades to come. Indeed the effects still resonate today.

A Blessing in Disguise?

A “Sorry, NO GAS” sign, 1973 (Credit: H. Armstrong Roberts/ClassicStock via Getty Images)

Looking back, the 1973 oil crisis was more than a mere disruption. It served as a watershed moment, redirecting the course of automotive history.

It ushered in an era where drivers, designers, and manufacturers alike began to consider not just the thrill of the drive, but the resources that made it possible.

The long-term ramifications of this crisis are still felt today, with the echoes of 1973 driving innovation, pushing boundaries, and moulding the future of motoring.


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