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Posted: Sunday, March 6, 2011 12:00 pm

By Colleen Flaherty

Killeen Daily Herald

Killeen resident Don Michaels sold his truck in 2008, due to record fuel prices. He purchased a smaller car and waited until gas prices fell to trade back up to another used truck, a 1999 Chevrolet Tahoe.

It served Michaels well until about a month ago, when he again noticed that gas prices were rising. He put the truck up for sale on Craigslist last week, after it took close to $100 to fill his tank.

"When I finally drove it to the gas station, I saw the prices and I said, 'Oh, no,'" he recalled. "I said, 'I might as well go ahead and do it.'"

Once Michaels sells his truck, he'd like to buy another compact car. This time, however, he'll stick with it, he said. The housekeeper commutes to Temple every day and is sick of the up-and-down gas market.

"I've been driving a long time, and it's never been anything like from 2008 to now," he said.

Michaels may not be alone. Following strong national car and truck sales last month, according to figures from Autodata Corporation, some local automobile dealers are bracing themselves for the fuel-efficient car boom that may lie ahead.

At the beginning of March, the average cost of regular gas in Texas was just above $3.25 per gallon, according to data from GasBuddy.com. As of Friday, the average cost was about $3.39.

Bell County gas prices trend about two cents lower than the state average.

At the beginning of February, gas cost less than $3 per gallon.

This week' prices are approaching a psychological barrier of $3.50 that many Central Texas consumers have in regard to gas, Killeen car dealership managers said.

James Mills of Bates Nissan said that only when gas hit that number during the summer of 2008 did people begin to trade in their bigger vehicles or invest in a small third vehicle while they "parked" their larger ones.

Things aren't that bad yet, he said.

"Everybody's always wanting to be conserving gas mileage, but until $3.50, I don't think we'll see a big increase (in clients)."

Nationwide, General Motors saw a 51 percent increase in light truck sales last month over February 2010. Connell Chevrolet also saw high sales, but they've slowed somewhat since the beginning of the manufacturer's promotional Truck Month, manager Patrick Tefft said.

"February was pretty good, but as soon as March 1 hit, it was like somebody turned the faucet off," he said.

Tefft said he didn't know if gas prices were affecting sales, as business is traditionally slower at the beginning of the month, but he's wary of increasing gas prices.

He doesn't want another repeat of 2008, he said. Sales were down and the market was flooded with used trucks, particularly diesel trucks.

"Those were bad times and I don't want to see a repeat, so I'm hoping I wake up tomorrow and gas is $1.79."

Texas gas prices peaked in July 2008, but fell sharply at the dawn of the recession. They bottomed out in March 2009, at $1.42 per gallon. They've increased relatively steadily since, until the recent spike.

The trend has widely been attributed to unrest in the Middle East and North Africa, most recently Libya. According to published reports, Libya supplies two percent of the world's oil and its production has been curtailed by internal conflict. Because oil is an inelastic commodity, any decrease in supply can have seemingly incommensurate effects on demand and price.

At Toyota of Killeen, manager Lloyd Sturgeon isn't bemoaning the gas market. He's sold at least eight hybrid Prius models in the last two weeks, among other small vehicles.

"As soon as (the price of gas) started increasing, hybrid sales have taken off," he said.

Unlike some manufacturers, the summer of 2008 was a partial boon for Toyota, Sturgeon said. The dealer had a Prius waiting list.

"It's trending that way now," he said. "If gas continues to rise, the same thing's going to happen again."

Contact Colleen Flaherty at colleenf@kdhnews.com or (254) 501-7559. Follow her on Twitter at KDHfeatures.

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