Oh, what a short memory vehicle shoppers seem to have with respect to high gas prices.
While national-average pump prices surged into May, to a national average peak of about $3.98—topping off 20 consecutive weeks of price gains—they've since started to settle downward to about $3.71 this week.
And it appears that demand for small and fuel-efficient late-model vehicles—including hybrids like the Toyota Prius—is already starting to wane.
According to new data from Kelley Blue Book, the slightly lower gas prices are already influencing purchase decisions, and the strong-demand and short-supply situation for small cars is abating.
So far this year, while on a market-wide basis vehicles are up $950 percent, or about 5.4 percent on average, hybrids are up about $3,000 (more than 20 percent). Hybrids saw a $300 rise in May alone, then dropped $50 just over the past week (ending June 10).
Of course it can be argued that fuel prices weren't entirely to blame; the sudden run on a number of small-car models, as well as the Prius—was also due to supply interruptions related to the March earthquake and resulting tsunami in Japan.
Among compact and subcompact models, the trend was similar; they rose $2,250 and $2,200 respectively in value, year to date, while compacts fell $50 and subcompacts dropped $25 just over the past week.
The KBB figures are based on used vehicles for model-year 2008 through 2010.
Gas prices are expected to continue their downward trend for a while longer, with OPEC's recent decision to maintain current production levels, as U.S. demand remains at lower levels. So we advise that if you're planning to choose a smaller or more fuel-efficient next vehicle, it might really pay to hold off for an extra month or two. Then you'll not only have a lower gas budget the next time high prices roll around; you'll also have paid less for that fuel-stingy vehicle.
This story originally appeared at The Car Connection