TSLA364.3600.8%
GM86.5800.46%
F14.0350.155%
RIVN16.2750.225%
CYD35.9100.01%
HMC32.5250.91%
TM198.1405.66%
CVNA69.915-0.365%
PAG217.5150.905%
LAD364.410-1.74%
AN206.800-0.42%
GPI281.700-0.14%
ABG209.4100.6%
SAH76.7100.19%
TSLA364.3600.8%
GM86.5800.46%
F14.0350.155%
RIVN16.2750.225%
CYD35.9100.01%
HMC32.5250.91%
TM198.1405.66%
CVNA69.915-0.365%
PAG217.5150.905%
LAD364.410-1.74%
AN206.800-0.42%
GPI281.700-0.14%
ABG209.4100.6%
SAH76.7100.19%
TSLA364.3600.8%
GM86.5800.46%
F14.0350.155%
RIVN16.2750.225%
CYD35.9100.01%
HMC32.5250.91%
TM198.1405.66%
CVNA69.915-0.365%
PAG217.5150.905%
LAD364.410-1.74%
AN206.800-0.42%
GPI281.700-0.14%
ABG209.4100.6%
SAH76.7100.19%

Tariffs drive late-quarter surge in new car sales, CarGurus reports

The data shows new car retail sales jumped almost 30% month-over-month following the March 26 tariff news.
CarGurus released its Q1 2025 Quarterly Review, revealing that tariff concerns dominated the quarter, leading to a late-month sales surge.

Kevin Roberts, CarGurus’ Director of Economic and Market Intelligence

CarGurus, the No. 1 visited digital auto platform for buying and selling vehicles, has released its Q1 2025 Quarterly Review, highlighting key trends shaping the automotive market. The report reveals that tariff concerns dominated the quarter, leading to a late-month surge in new car sales and further straining affordability in both new and used vehicle markets.

Last-minute buying rush

While consumer demand remained stable for most of Q1, a shift in urgency emerged in late March as the announcement of impending auto import tariffs took effect. Nearly half of all new vehicle listings are imports, and CarGurus data shows new car retail sales jumped almost 30% month-over-month following the March 26 tariff news.

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Kevin Roberts, CarGurus’ Director of Economic and Market Intelligence, noted, Steady consumer purchase patterns for most of the first quarter suggest a market in wait-and-see mode. But a shift in urgency has taken hold as impending tariffs start to take effect, influencing an uptick in activity.”

New car affordability under pressure

Finding an affordable new car is becoming increasingly difficult. Vehicles under $30,000 now represent just 13% of inventory, a sharp decline from 37% in Q1 2020. With tariffs in play, affordability concerns are expected to worsen:

  • The average new car price could rise by over $3,300, pushing it to approximately $52,800.
  • Listings under $30,000 may decline by 42%, while those over $50,000 are projected to rise by 15%.

Import models in lowest supply include high-demand compact and fuel-efficient vehicles priced under $40,000, such as:

  • Toyota RAV4 and Tacoma
  • Honda Civic and CR-V
  • Subaru Crosstrek and Forester

Used car market: more options, but tougher trade-offs

While the used car market remains a more affordable alternative, the value proposition has shifted:

  • Inventory is up, but buyers with budget constraints are faced with older vehicles and higher mileage.
  • In Q1 2020, $15,000–$20,000 could buy a four-year-old car with 47,000 miles. Today, the same budget gets a seven-year-old car with 73,000 miles.
  • The share of used car sales under $20,000 has fallen from 64% in 2020 to just 43% in 2025.

However, as affordability challenges persist, the used electric vehicle (EV) market is gaining traction. With supply increasing and prices stabilizing around $36,000, EVs are becoming an attractive, low-mileage alternative to gas-powered vehicles. Notably, EVs priced under $25,000 are selling faster than comparable internal combustion models.

For example, the Nissan LEAF and Chevrolet Bolt stand out, averaging under $17,000 with mileage below 32,000.

Tips for shoppers navigating the market

Ultimately, CarGurus recommends the following strategies for buyers:

  • Monitor price trends: Use platforms like CarGurus to track inventory and price changes.
  • Understand financing early: Pre-qualifying for loans can help shoppers narrow down options based on real interest rates.
  • Expand your search: Exploring a wider geographic area can help secure better deals, even with potential delivery costs.
Read More
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