In June 2025, CNBC reported that used vehicle prices in the U.S. have begun to stabilize after a significant spike, largely driven by President Donald Trump’s 25% tariffs on imported vehicles and auto parts. These tariffs, implemented in April 2025, have reshaped the automotive market, influencing both new and used vehicle prices. While the tariffs do not directly target used cars, their ripple effects have caused notable shifts in consumer behavior and market dynamics, as outlined in the article.
The Manheim Used Vehicle Value Index, a key indicator of wholesale used vehicle prices, dropped 1.5% from April to May 2025 but remained 4% higher than the previous year. This easing followed a 4.9% surge in April, the highest since October 2023, as consumers rushed to buy vehicles amid fears of tariff-induced price hikes. The tariffs, applied to imported passenger vehicles, light trucks, and critical auto parts like engines and transmissions, have increased new vehicle costs by an estimated $2,000 to $15,000, depending on the vehicle’s import content. This has indirectly driven demand for used cars, as buyers seek more affordable alternatives.
The article highlights how new vehicle price increases, coupled with reduced production and tighter supply chains, have pushed consumers toward the used car market. With only 2.2 million used vehicles available—low compared to historical levels—demand has outstripped supply, keeping prices elevated. Cox Automotive noted that retail used vehicle sales in May fell 3% from April but rose 4% year-over-year, reflecting sustained interest despite higher costs. The average retail listing price for used vehicles climbed 2% to over $25,000 in the four weeks leading up to May.
Trump’s tariffs aim to bolster domestic manufacturing by incentivizing U.S. production, but critics argue they burden consumers. The policy has sparked a “fear-buying” trend, where buyers purchase vehicles preemptively, further straining inventory. While some relief came from an April 2025 executive order softening tariffs on U.S.-assembled vehicles’ imported parts, the broader impact persists. Analysts predict long-term challenges, including potential sales drops of up to 2 million vehicles annually and industry costs exceeding $100 billion. As new car prices remain high, used vehicle prices are likely to stay elevated, reshaping affordability and consumer choices in the U.S. auto market.