American used car prices haven’t increased for over two years, until now. A study conducted by automotive research site iSeeCars concluded that used car prices have risen after months of consistent declines. This could be great news for used car dealers and horrible news for folks looking to purchase a used car in 2025.
Why have used car prices suddenly increased? This deviation from the norm surely isn’t coincidental. Tariffs are the culprit, and they could take the average used car price to the moon (in the worst way possible).
After the events of ‘Liberation Day’, a potential trade war involving multiple world powers is a nightmare-turned-reality. Import tariffs don’t just impact new cars and car parts, they cause chaos in the used car market as well.
Used car prices for one to five-year-old models have increased by 1% year-over-year as of March, 2025. This equates to an average price bump of $317 compared to an average price decrease of $238 in February.
An increase of $317 may not seem like much, but it’s notable at a time when the price of eggs is a topic of economic frustration for consumers. Furthermore, used car prices have been in the red year-over-year for consecutive months since October 2022, this is a huge shock for the used car market.
The tables have turned and this has serious implications for millions of car buyers. Increased demand may give used car dealers sweet relief after a rough post-pandemic reality, but will higher sticker prices prevent some drivers from exploring purchasing opportunities?
Car shopping in 2025: Why Trump tariffs, supply issues could make spring and summer the worst times to buy
We are nearly four months into President Donald Trump‘s second term in office. In the span of the last few weeks, tariffs have been teased, announced and paused. Unfortunately for the economy, whether or not certain tariffs are actually in effect, the mere threat of increased trade costs is enough for companies to make major changes. Sometimes these changes will benefit American consumers, other times they’ll practically price them out of the market.
The announcement of import tariffs on new vehicles and auto parts was enough for several automakers to entertain the idea of pausing shipments and adapting production strategies. As a result, the supply of affordable new vehicles in America will dwindle because so many automakers rely on foreign labor and supply chains. Less affordable new cars make used cars much more attractive.
Used car buyers have found themselves in the eye of a perfect storm created by a post-pandemic economy and a brewing trade war. Used car prices were declining in recent months because dealers were sitting on older inventory, which often gets less desirable over time for the average consumer. Demand drove down prices, which in turn created thousands of dealer lots filled with nameplates and model years folks just weren’t interested in buying.
What happens when those models become the only options American car buyers can afford within reason (due to tariffs)? Prices are expected to increase as demand for new vehicles slows, adding weight to the demand seesaw and bringing used car prices to new heights.
This scenario is music to the ears of used car dealers looking to offload inventory at prices that won’t obliterate their profit margins. On the other hand, actual deals could be scarce if prices are inflated due to newfound demand. There will still be plenty of opportunities to score a great new car for the informed consumer in 2025, but don’t expect those opportunities to stick around forever.

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