DETROIT — Used car prices surged last month, reaching their highest point since October 2023 as consumers, wary of impending price increases linked to auto tariffs, made a rush to purchase vehicles. The Manheim Used Vehicle Value Index, a key measure that tracks prices at U.S. wholesale auctions, rose by 4.9% year-over-year, settling at 208.2. This marks a notable increase of 2.7% from March and is well above the typical monthly fluctuation of just 0.2%, as reported by Cox Automotive.
Jeremy Robb, senior director of economic and industry insights at Cox Automotive, noted that the expected seasonal price increase had extended beyond its usual end in mid-April. “This year’s trends have shown a stronger appreciation in wholesale prices than we typically anticipate,” Robb stated, emphasizing the role of tariffs in driving these market dynamics.
The newly implemented 25% tariffs on imported vehicles and parts have not directly impacted used vehicle sales but have influenced new car pricing and availability, subsequently affecting the secondhand market. Most Americans buy used cars, making this interaction critical for consumers.
While retail prices typically follow wholesale movements, they have not adjusted downward as rapidly in recent years. In April, retail used-vehicle sales saw a modest decline of 1.7% compared to March, yet showed a robust increase of 13% from the previous year. According to Cox, the average listing price for a used vehicle rose by 2% over the last month, surpassing $25,000, while new vehicles are selling for close to $48,000.
Despite remaining below the peak levels seen during the pandemic, the Manheim index indicates that used vehicle prices are still relatively elevated when compared to pre-COVID figures from 2020. Cox Automotive has observed a trend of stabilization in used car prices after significant volatility over the past few years, a shift that began gaining traction in 2024.
Data suggests that dealers and consumers alike are bracing for potential long-term effects of the tariffs, adjusting their buying and selling strategies in anticipation of market changes. As the automotive landscape continues to shift, the implications of these tariffs, combined with consumer behavior, will likely shape the used car market for the foreseeable future.