New car incentives fall as petrol price rises Rising fuel costs could result in higher prices for cars in the US as dealers scale back incentives on popular fuel-efficient models, industry analysts say. Growing demand for smaller and more fuel-efficient cars helped push up February car sales in the US to an adjusted annual rate of 15.1m, the highest level since 2008. However, demand for these models makes dealers less inclined to offer incentives and other discounts to lure in shoppers, said Kelley Blue Book, the automotive information provider, in a recent report. Kristen Andersson, analyst at TrueCar.com, which estimated incentives fell 4.2 per cent in February from a year ago, added: "If gas prices continue to rise, car buyers can expect to see incentives decline on fuel-efficient vehicles." The growing demand for smaller models - such as Ford's Focus, which recorded its strongest February sales in 12 years - comes as the average nationwide price for a gallon of regular petrol reached $3.767 on Monday, up nearly 30 cents from a month ago, according to the American Automobile Association. Prices have passed $4 a gallon in Alaska, California and Hawaii. "In both 2008 and 2011 Kelley Blue Book saw monthly market share for compact cars increase by more than 3 percentage points when fuel prices peaked, and, as more consumers flock to compacts, prices will remain firm," Kelley said. Ford estimated last week that compact cars" total industry share rose to near 24 per cent in February from 20 per cent in January. Toyota and Honda in particular are poised to benefit because they are still gaining back consumers after inventory problems in the wake of the March 2011 Japanese earthquake, said Lacey Plache, chief economist at Edmunds.com, the car research website. People think of them as being the fuel-efficient vehicles, and their inventories have normalised. Hybrid and electric cars, however, have not benefited as much from fuel economy concerns as might have been expected. On Friday General Motors said it was suspending production of its electric Chevrolet Volt to reduce a backlog of vehicles following a slump in sales in January and February. "The price premium on the Volt just doesn't make economic sense for the average consumer when there are so many fuel-efficient gasoline-powered cars available, typically for thousands of dollars less," Ms Plache said.