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Small Cars Drive March US Auto Sales Higher

General Motors, Ford,Honda,Hyundai and Nissan all reported higher U.S. sales of new vehicles in March, helped by strong demand for models that get better gas mileage.

Anne Rippy | Riser | Getty Images

New vehicle sales rose 11 percent at GM, 16 percent at Ford, 23 percent at Honda and 27 percent at Nissan, all aided by sales of smaller, more efficient cars and crossovers, which look like truck-based SUV but are more fuel efficient and nimble because they are built on car underpinnings.

Truck sales, though, also were healthy last month for just about every manufacturer.

GM said total U.S. sales in March for its four core brands rose 11.4 percent from last year to 206,621 vehicles.

GM's increase was propelled by the new Chevrolet Cruze, its first well-received small car in years. The vehicle posted an 80 percent sales gain over its lackluster predecessor, the Cobalt. The increase was by far the largest for any GM vehicle last month.

Ford said total sales in March rose 19.2 percent and the automaker outsold GM for only the second time since 1998.

Ford said buyers gravitated to smaller, more fuel-efficient cars and crossovers because of rising gasoline prices. Sales of the new Fiesta subcompact jumped 56 percent from February. The new Explorer crossover, Fusion sedan and Escape small SUV also saw strong gains for the month.

Chrysler said its 31 percent sales increase was led by midsize sedans such as the Chrysler 200, which was featured in a popular Super Bowl ad, and the Dodge Avenger. Sales growth for cars outpaced trucks, but truck sales still were strong at Chrysler.

J.D. Power and Associates predicted that nearly a quarter of vehicles sold to individual buyers were compact or subcompact cars. That is the highest amount since the Cash for Clunkers program encouraged people to choose more fuel-efficient models in the summer of 2009.

The national average for a gallon of gas hit $3.58 this week, the highest price ever for this time of year. Gas prices have jumped 25.1 cents per gallon in the past month.

Some buyers also may have jumped to buy cars that are made in Japan, such as Toyota's Prius and Honda's Fit subcompact, figuring that shortages will hit in the coming weeks because of a March 11 earthquake that has interrupted production.

Toyota U.S. sales in March were down 5.7 percent from the same time last year. The automaker sold a total of 176,222 units last month. Sales for its Lexus model were up 2.3 percent.

Toyota resumed production of the Prius this week, but some U.S. dealers have already sold out of the popular hybrid.

GM's midsize crossovers also continued to be hot sellers in March. The Chevy Equinox rose 17 percent and GMC Terrain jumped 29 percent. Sales of the Chevrolet Silverado pickup, the company's most popular vehicle, rose 9 percent.

But the company ended two months of sweet deals and its overall sales growth lagged rivals. GM raised discounts by about $400 per vehicle in January and extended them into February. GM said it cut incentives by $600 to $800 in March.

Slideshow: 30 Cars That Get 30 MPG

"The hefty—and costly—incentives from GM in the first two months of the year fell back to earth in March, and that translated into lackluster retail sales," Edmunds Director of Industry Analysis Jessica Caldwell said in a statement.

GM said gas prices will determine whether compact sales will continue to rise through the rest of the year.

Other automakers reporting sales Friday included:

Kia Motors America, with a 44 percent increase from March of last year. The Optima midsize car saw a 90 percent sales increase.

—Honda Motor sales jumped 23.4 percent to 133,650 vehicles on sales of models with good gas mileage. The subcompact Fit led the way with a 49 percent increase, while Civic compact sales rose more than 40 percent.

—Nissan Motor sales jumped 27 percent for the month, the best month in the company's history. Sales of the Sentra compact more than doubled.

Hyundai Motor America reported a 32 percent sales jump. Sales of the Elantra compact more than doubled.

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