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Fewer Incentives for Fuel-Efficient Cars

As car sales continue to rise, consumers in the market for a fuel-efficient car will be hard pressed to find a good deal, experts say.

2012 Toyota Corolla

Car sales in February are projected to rise 20% from the previous month and 6% from a year prior, according to estimates by Today Chrysler reported its sales rose 40% in February and Ford Motor’s sales rose 14%. Analysts say fuel-efficient subcompacts and small sedans are among the most in demand as gas prices continue to rise and consumers look for ways to minimize their pain at the pump. But scoring good prices at the dealership may now be harder as cash-back deals and discounts on these cars continue to drop, says Alec Gutierrez, senior market analyst at Kelley Blue Book. The average incentive on a subcompact car was $756 in January, down 2% from a month prior and down 10% from the summer, according to, which tracks car prices and deals. Year over year incentives plummeted 40%. By the spring, “deals on gas-efficient vehicles will be hard to come by,” says Jesse Toprak, vice president of market intelligence at

It all boils down to demand: Sales of fuel-efficient cars increased three to four percentage points each month when gas price surged beyond $4 a gallon in 2008 and 2011, says Gutierrez, a trend that will likely continue this year. For car manufacturers, “there’s no reason to spend money to chase buyers that will already be there,” he says.

While deals are dwindling, consumers can still find some free cash on small cars, including up to $500 in rebates on the 2012 Toyota Corolla and on the 2010 Hyundai Sonata Hybrid.

Higher gas prices may be good news for those in the market for a big car – manufacturers are rolling out more incentives on gas guzzlers, like SUVs and trucks, in an attempt to boost demand.


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