High Gas Prices Drive Consumer Decisions in the Auto Market

• U.S. retail gasoline averaged $4.24¹ per gallon in April — the highest April price since 2022 and a 28% jump YoY.
• New-vehicle prices exceeded $50K for the first time while supply held flat.
• Hybrids are the hedge against rising fuel costs — new-hybrid inventory is up 19% YoY, with stable pricing and the fastest inventory turn compared to other fuel types (47 days).

A four-month run-up from the low $2.94¹ per gallon cost for gasoline in January 2026 has driven a sharp 44% increase — the highest in nearly four years. This lands on top of already-stretched consumers, and the marketplace data show consumers reacting.

Car Shoppers Respond to Economic Crunch

Newly added April inventory averaged over $1,000 more expensive than the same time a year ago, as the average new-car price climbed above $50,000 for the first time. New vehicles are moving off the lot faster, in part due to lower inventory of key models, including the Ford F-150 and Chevrolet Silverado 1500, resulting in the sell-down of aged inventory, which brought the average lower. On the flip side, Hyundai, Kia, BMW, Subaru, Volkswagen, GMC and Toyota are all growing inventory, but they’re all sitting on it longer.

This picture is consistent with payment-sensitive consumers pulling back from the new market rather than trading down within it. If they are trading down, it’s happening in the used market, which is seeing an influx of lower-mileage, higher-quality inventory as the 2022-to-2023 off-lease wave flows in. Just over half of in-market shoppers report that rising gas prices have led them to consider a smaller body style, with Gen Z and lower-income respondents significantly more likely to be considering it.²

Fuel Spikes Drive Electric Demand

As gas prices continue to rise, 44% of respondents to a recent Cars.com survey said they are likely or very likely to consider a hybrid vehicle.² And there are plenty of options; new-hybrid supply has roughly doubled since April 2024 and is up 19% YoY. OEMs broadly announced pivoting away from pure EVs to a mix that includes hybrids around the start of 2024, which are now hitting the market. This segment is also seeing the fastest turn of new vehicles, with new hybrids sitting on the lot an average of 47 days, versus the overall average of 71 days and 115 days for electric vehicles.

The used market for hybrids and EVs is really heating up, and the supply story explains why. Used hybrid supply is up 24% YoY, with inventory coming in with fewer miles, down 14% to an average of 44K miles. OEMs pivoted toward hybrids in response to the previous $4/gallon gas spike in 2022, creating the used inventory supply that mirrors today’s market needs. Used EV inventory is also benefiting from off-lease vehicles returning to market, up 10% YoY with an average of 32K miles. Even as prices have increased in both segments YoY, used hybrids are only staying on the lot an average of 38 days, the quickest turnaround of any segment, and used EVs are averaging 42 days. For consumers considering switching to electrified powertrains, these are the segments where supply is growing, but so is demand — and prices are climbing YoY as rising fuel costs accelerate the shift.

Industry Insights

Explore Cars.com/News/Insights for the latest on consumer demand, market supply, pricing, affordability and more for your corner of the market.

¹ Source: U.S. Energy Information Administration, Monthly U.S. Retail Gasoline Prices

² Source: Cars Commerce, Impact of Rising Fuel Costs survey (April 3-7, 2026), n=524; respondents planning to purchase a vehicle within six months