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High gas prices? Time to buy a new car!

High gas prices? Time to buy a new car!

Posting in Technology

Rising gas prices appear to be spurring demand for new, fuel-efficient cars, if March sales numbers are any indication.

Consumer demand for new cars shows no signs of letting up, according to sales numbers released Tuesday.

The picture was positive for domestic automakers: General Motors's sales were up 12 percent for March, while Ford and Chrysler (now controlled by Fiat) saw a 5 percent and 34 percent uptick in domestic sales, respectively. Ford also saw record sales of fuel-efficient models such as the Focus.

AutoNation, the country's largest auto retailer, reported 25,489 new cars sold. The group's sales were up 13 percent in the first quarter. As a result of the strong sales, AutoNation now says it expects the auto industry to sell between 14.4 million and 14.7 million cars in 2012.

AutoNation also reported a 10 percent jump in imports, as well as sales of luxury brands. Toyota saw a 20 percent uptick in sales, while Mercedes saw an 18 percent increase.

The average U.S. car is 10.8 years old, and AutoNation CEO Mike Jackson attributes the spike in sales to pent-up demand. As consumers think about replacing their old cars, rising gas prices are actually accelerating the move towards newer, more fuel-efficient vehicles, he said.

“The need is bringing them in, and they see the big gain that’s available to them in fuel efficiency since the last time they looked,” Jackson said. “And they say that’s a good reason to buy.”

Perhaps the ever-increasing price of gas will ultimately help get some of our old gas guzzlers off the road.

Photo: Ford

via [AutoNews, Forbes]

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Channtal Fleischfresser

Contributing Editor

Contributing Editor Channtal Fleischfresser has worked for The Economist, WNET/Channel 13, Al Jazeera English, Wall Street Journal and Associated Press. She holds degrees from the University of Pennsylvania and the Columbia University Graduate School of Journalism. She is based in New York. Follow her on Twitter. Disclosure