Can fuel economy keep getting better?

These are interesting times for the automotive industry, and for anyone who depends on cars.

Better-engineered cars and light trucks, combined with continued economic uncertainty, have convinced many Americans to hold on to their vehicles longer. But newer cars are the most fuel-efficient consumer models ever made.

Just this week, the Environmental Protection Agency announced that new vehicles in 2013 reached an all-time high for fuel economy, with those 2013 models getting on average 24.1 miles per gallon. That's a one-half mpg increase over 2012 models and an increase of nearly 5 mpg since 2004.

The EPA said one big reason for that improved fuel efficiency is the recent adoption by automakers of "more efficient technologies" such as direct-injection fuel systems, turbochargers and technologically advanced transmissions.

"We are thrilled to see that manufacturers continue to innovate and are bringing technologies to improve fuel economy online even faster than anticipated," EPA Administrator Gina McCarthy said in a statement. "Consumers now have many more choices when shopping for vehicles with higher fuel economy and lower emissions compared to just five years ago."

Backing up those claims is a new report from the University of Michigan Transportation Research Institute (UMTRI). According to that report, the average fuel economy of "light-duty vehicles" (cars, pickup trucks, vans and SUVs) sold in the U.S. has improved from 20.1 miles per gallon in October 2007 to 25.3 mpg last month.

"Because of their improved fuel economy," the report notes, "the vehicles sold since October 2007 saved a cumulative total of about 15.1 billion gallons of fuel -- equivalent to the current total consumption of all vehicles in the U.S. for about 33 days. This reduction in the amount of fuel translates to a reduction of about 297 billion pounds of carbon-dioxide emissions."

But concerns are now rising that given the recently lower cost of gasoline, thanks to rising oil and gas production in North America, consumers will resume their love affair with larger and less fuel-efficient SUVs and trucks.

Indeed, another UMTRI report said that while overall fuel economy continues to climb, the gas mileage of new vehicles sold in the U.S. last month had its largest drop in nearly three years.

"This large drop likely reflects the increased sales of light trucks and SUVs, and the reduced demand for fuel efficient vehicles of all types because of the falling gas prices," UMTRI research professor Michael Sivak said in a statement.

Eric Ibara, director of residual value consulting for Kelley Blue Book, notes that while sales for the electric car sector are up 20 percent so far this year compared to 2013, sales of hybrid and alternative fuel cars are down 11 percent as of last month.

And he suggests that lower gasoline prices, coupled with the greater fuel efficiency brought on by breakthrough auto design and engineering, are keeping the internal combustion engine economically viable for both consumers and the auto industry.

"What is most amazing is that fuel economy gains were made while horsepower was increased, a trade-off that previous car designers had always struggled with," Ibara told CBS MoneyWatch.

"Clearly, it is not realistic to assume that these breakthroughs will continue, but the trend over the past five years has been toward smaller yet more powerful engines," he added. "Today it is possible to buy an affordable car that delivers more than 40 mpg on the highway while delivering more than 120 horsepower."

And while the sun may eventually set on the internal combustion engine, Ibara said that for now "it is still shining brightly in the U.S. auto market,'' with 90 percent of all auto sales today involving vehicles with traditional gas-powered engines.