guggenheim securities' john casesa credits an aging vehicle fleet and an improving economy. >> incomes are finally growing, unemployment is diminishing slowly, and consumer confidence has bounced back. >> reporter: the robust demand is helping auto companies make a lot more money. in april, vehicle transaction prices were up 1% over march, while incentive spending was down 4%. but industry watchers warn the recent buying spree could run out of gas, and higher fuel costs are part of the problem. in many markets, pump prices are up over $4 a gallon, and casesa says consumers on a tight budget could get sidelined if gas goes higher. >> it's hard to say at what price higher gas prices will choke off auto demand, meaning prices have to get so high that people don't have enough left over for discretionary purchases like an automobile. >> reporter: higher fuel prices could steer more buyers away from trucks and sport utilities to smaller vehicles. but they might have a hard time buying the compact cars they want. the disaster in japan has thrown a wrench into the production of vehicles and pa