Used Vehicle Prices on Rise in U.S., a First in Two Years

It was widely predicted that used vehicle prices would rise if U.S. auto imports were implemented and remained in place for any length of time. The first signs of repercussions are now becoming apparent.

Increased demand for second-hand vehicles is a logical consequence of higher new-vehicle prices, of course. Estimates are that those prices could climb by anywhere between $3,000 and $20,000 USD.

According to iSeeCars, March saw the first increase in the average price of a used vehicle in the U.S. in two years. The group used data for vehicles aged one to five years. The information is based on the price analysis of more than 1.4 million vehicles.

A used-car dealership in Langinsburgh, New York | Photo: Wikimedia Commons

Recall that the pre-owned market exploded coming out of the pandemic, a trend exacerbated by a shortage of semiconductors that hampered the supply of new vehicles. All of that sent vehicle shoppers streaming into the used-car market.

iSeeCars analyst Karl Brauer explains that “During the pandemic, new vehicle prices soared when auto factories shut down and production didn't meet demand. With tariffs, prices will likely increase regardless of demand, leading to a similar rise in new vehicle prices that could push used car prices higher.”

Interestingly, the study looks at price fluctuations by model category for the month of March. It reveals fluctuations in the average used-vehicle price change between vehicle segments and formats:

• - Pre-owned SUVs - plus 3.5 percent
• - Pre-owned pickups - plus 0.9 percent
• - Pre-owned hybrid vehicles – plus 0.7 percent
• - Pre-owned cars and vans - minus 3.2 percent
• - Pre-owned all-electric vehicles – minus 10.1 percent

What happens in April and beyond will be dictated by how the trade dispute evolves. It’s also clear that we can expect to see the trends outlined above repeated in Canada, given the counter-tariffs imposed on vehicles imported into Canada from the U.S. by Mark Carney’s federal government.

iSeeCars estimates that should tariffs remain in place at current levels, used vehicle prices could rise by 10 percent, or an average of $3,200 USD ($4,470 CAD)