Once again, as gas prices increase, small car sales also increase.

According to DesRosiers’ research, while fuel prices were low back in 2007, sales of small cars decreased by 50%, while in 2008, when fuel prices spiked, small car sales increased 50% back.

DesRosiers says, “it isn’t necessarily the amount that consumers have to pay for gas that is critical. Instead, it is the expectation of increase and/or decrease. Once gas prices stabilize, even if at a high level, then sales of entry-level vehicles stabilize”.

This remains true as long as car manufacturers don’t offer huge incentives and rebates. Statistics also show that most car buyers will go for the big incentives when these are substantially large, instead of the fuel economy factor. Prove of that is, the consistent number of trucks, pickups, minivans and SUVs sales during 2010 and 2011 and this new semester.

“Each litre per 100 km of fuel efficiency translates into between $3,000 and $3,500 of fuel savings over the life of a vehicle at current gas prices on a present value of money basis. Who knows what gas prices will be 20 years from now, but I’d bet they will be higher – indeed a lot higher – so the fuel savings could be much higher than this amount”.

“So over the life of a vehicle fuel efficiency makes a huge difference in the cost of operating a vehicle.”

Amongst the best small cars to buy at the moment are: Chevrolet Cruze, Hyundai Elantra. Honda Civic, Toyota Corolla and Mazda3.