With used car prices climbing again, the forces behind it could result in a shift for both new and used vehicle markets in 2025. In this episode of CBT Now, Karl Brauer, executive analyst at iSeeCars.com, joins us to explore what’s fueling the price rebound, the impact of tariffs, and why electric vehicles remain the outlier in a tightening supply landscape.
After months of decline, used car prices are on the rise again. According to Brauer, he shared that March marked the first year-over-year increase in used vehicle prices since October 2022, with an average bump of 1%, reversing the previous 7.4% decline seen in June 2024. While this may seem like a modest shift, it signals renewed upward momentum in the pre-owned market, and Brauer cautioned that this rebound occurred before the effects of proposed tariffs on new vehicles began.
Brauer draws parallels to the early days of the 2019 pandemic when used car prices soared 8.95% in just eight months due to supply chain disruptions. He notes that his team ran models on the 25 most popular used vehicles to estimate the impact of potential future increases:
- A 10% hike could push prices on a Kia Forte up by $1,700
- A 10% push could shift the prices of a Chevy Tahoe by over $5,000.
With the average used car price now at $31,400—up $317 from the prior month—Brauer warned that consumers looking to escape rising new car costs might not find much relief in the used market.
The only exception? Electric vehicles. While the broader market ticked up, average EV prices fell by $3,865 year-over-year. Brauer explained that used car shoppers tend to prioritize value and cost-efficiency over brand or environmental goals, which suppresses demand for used EVs despite their prevalence on dealer lots.
Further complicating supply is a lack of off-lease returns—many lessees are now buying out their vehicles rather than returning them, squeezing inventory even more. Dealers are also retailing higher-mileage vehicles than before, with cars over 90,000 miles now seen as viable retail options thanks to better engineering and longer vehicle lifespans. As Brauer noted, many modern vehicles can last up to 250,000 miles, making even six-figure odometers less of a deterrent for savvy used car buyers.
Looking ahead, Brauer was cautious about making strong forecasts, noting that even auto CEOs like Elon Musk are refraining from predictions in today’s volatile environment. Still, he anticipates continued demand and tight supply will keep prices elevated, despite broader economic concerns and reduced consumer spending.
"The idea that you can't rely on a 100-plus-thousand-mile car as a new buyer coming into the used market... that is not true anymore as long as you do your diligence and make sure the car is healthy." – Karl Brauer
