CarGurus is forecasting that as gas prices climb toward $4.50 a gallon, prices on fuel-efficient used vehicles will follow with an increase of 15 percent by August. CarGurus analysts say the correlation between gas prices and prices of fuel-efficient used cars has been notably high over the past 13 months: As gas prices climbed to nearly $4 a gallon last year, demand for used fuel-efficient cars followed, which sent prices on such vehicles up soon after. This year, CarGurus analysts expect to see a similar price correlation, the key difference being that prices on fuel-efficient used cars never fully recovered from last year's highs, so consumers will see prices peak in August at levels 10 percent higher than the same time last year.
CarGurus has tracked the list prices on used cars since August 2010 and regularly provides insights on related market trends. To arrive at this forecast, CarGurus analysts studied the correlation between 2011 gas prices and the historical average prices on a subset of fuel-efficient cars. CarGurus then considered the current market conditions to project prices through August 2012. (note:Models from Asian carmakers were excluded from this study to control for the effect of last year's tsunami and subsequent supply issues on price.) Gas price trends used in this study were obtained from the U.S. Energy Information Administration.
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