Why used cars are getting so expensive — and what you can do about it



The dream of driving off in an affordable used car is slipping away fast.

If you’ve been browsing used car lots or checking online listings, you’ve likely noticed prices are climbing rapidly. According to Cox Automotive’s Manheim Used Vehicle Value Index, wholesale used car prices in April 2025 hit their highest level since October 2023, with the index surging 4.9% year over year to 208.2.

Even older cars are commanding higher prices, as buyers focus on value over low mileage.

That’s a 2.7% jump from March alone, far exceeding the typical 0.2% monthly increase.

Surge ahead

What’s driving this price surge? A combination of new auto tariffs, shrinking supply, and changing consumer behavior is shaking up the used car market.

The main trigger is a 25% tariff on new imported vehicles and parts, introduced in April 2025, which is impacting the entire auto industry.

While these tariffs don’t directly affect used cars, they’re pushing new car prices — averaging $48,000 — out of reach for many buyers. As a result, more Americans are turning to the used market, where prices average around $25,000.

Cox projects retail used car sales will reach 20.1 million in 2025, a 1.2% increase from 2024, partly due to consumers shifting to used vehicles. April’s retail sales were up 13% year over year, despite a 1.7% dip from March, showing strong demand for used cars.

This increased demand has dealers competing fiercely at wholesale auctions to stock their lots. As Cox Automotive’s Jeremy Robb, senior director of economic and industry insights, explains, “The ‘spring bounce’ usually ends by mid-April, but this year, wholesale appreciation trends continued for the entire month and were much stronger than we typically observe.”

The result is clear: Wholesale prices are soaring, and retail prices are following, with used car listings up 2% in just four weeks.

Price hikes

Let’s look at what this means for your budget. According to iSeeCars.com, the average used car now costs $31,400, a $317 increase from last month.

Their analysts calculated the potential impact of further price hikes on popular models: A 10% increase could add $1,700 to a Kia Forte or $5,000 to a Chevy Tahoe.

That’s a significant burden for families already dealing with inflation and high interest rates. ISeeCars.com compares this to the pandemic, when used car prices rose 8.95% in eight months due to supply chain issues.

Supply shortages are worsening the situation. A key issue is the decline in off-lease vehicles returning to the market. Many lessees are buying out their leases instead of returning their cars, leaving dealers with fewer vehicles to sell.

Higher mileage

Cox reports that wholesale inventory in April was at 41 days’ supply, down from 46 days a year ago. To fill the gap, dealers are selling higher-mileage vehicles — cars with over 90,000 miles are now common, as modern engineering allows vehicles to last up to 250,000 miles.

This means even older cars are commanding higher prices, as buyers focus on value over low mileage. Tariffs are cutting into new car margins, so dealers are raising prices across the board — used cars included. The data confirm this, creating a tough environment for bargain hunters.

Electric slide

One segment is avoiding this price surge: electric vehicles, or EVs.

While gas-powered used cars see steady price increases, used EV prices dropped by $3,865 year over year.

One reason for this exception is that used car buyers tend to prioritize cost-efficiency over environmental goals, reducing demand for EVs despite their increased presence on dealer lots. EVs made up 3.4% of Manheim’s auction sales in April. For EV enthusiasts, this could be an opportunity to find a deal, but for most buyers, the used car market is increasingly expensive.

Looking ahead, the future is uncertain. Cox economists predict a volatile summer, with high prices and interest rates possibly slowing sales. However, slower sales could lead to dealer incentives, which might boost demand again.

ISeeCars.com analysts are cautious, noting that even auto industry leaders like Elon Musk are avoiding firm predictions in this unpredictable market. One thing is certain: With limited supply and strong demand, used car prices are unlikely to drop soon. Cox expects less depreciation than usual in the second quarter, so buyers should prepare for higher costs.

Plan ahead

For those shopping for a used car, strategic planning is essential.

Consider less popular models or EVs to avoid the steepest price increases. Timing can also help — waiting for potential dealer incentives later this year might save money.

However, the low prices of a few years ago are unlikely to return. The Conference Board Consumer Confidence Index fell 8.4% in April, reaching its lowest level since 2009, as concerns about inflation and rising costs grow.

With gas prices down 13% year over year but still fluctuating, and inflation expectations rising to 6.7%, buyers are rushing to secure deals before prices climb further. This urgency is driving the price surge, with tariffs adding to the pressure.

The used car market in 2025 is a challenging landscape, shaped by tariffs, supply shortages, and shifting consumer priorities. Whether you’re looking for a reliable sedan or a rugged SUV, expect to pay more — and plan carefully. By staying informed and choosing wisely, you can still find value amid all the rising prices.

Introducing 'Quick Fix': Practical answers to all your car questions



Here in California, cars have always been king. Just look at the respect with which we refer to our freeways — it's never just 405, it's the 405, as a much a unique monument to human ingenuity and aspiration as the Great Pyramid of Giza.

And yet California is in many ways the worst place to be a driver. It's hard to beat the view from the PCH, but it's liable to turn into a parking lot at any given moment. And onerous emissions standards — which we're happy to impose on the rest of the country — can make staying street-legal a tedious slog.

This dichotomy applies to the auto industry in general. As drivers we've never had more choices, but those choices can seem disappointingly similar and restrictive — especially if you want a good, old-fashioned gas-guzzler.

We have cutting-edge technology at our disposal, but too often it gets in the way of the driving experience instead of enhancing it.

As for buying a car, every day it gets more and more like going to the dentist. It's disorienting and time-consuming, and you never know how much it's going to hurt.

Fortunately we have Lauren Fix to ease our pain. The longtime industry journalist and automotive expert is here to help with Quick Fix, a regular feature in which she answers your car questions — just send them to getquickfix@pm.me.

— Matt Himes, managing editor

************

Welcome to Quick Fix, where I attempt to solve your car quandaries, one question at a time.

After decades covering the industry, I've developed an immunity to the hype and double-talk surrounding cars. It doesn't hurt that I'm a mechanic and automotive entrepreneur as well.

I want to use that experience to help you — whether you're buying a car, shopping for insurance, or dealing with the myriad other complications of being a driver in 2025. Send me your questions, and together we can cut through the BS and get back behind the wheel.

That's the fun part, after all.

Today's question comes from Matt in Whittier, California. He writes: "After driving a used Tesla Model X for a few years, my wife is dead set on upgrading to a new Model 3. My question is: lease or buy — especially now that Elon's allowing lease buyouts?

"Bonus question for you: I doubt it will work, but can you suggest any Tesla alternatives I can pitch to my wife?"

Check out my answers in the video below — and send me any car questions you need answered to getquickfix@pm.me.

10 tactics to beat even the pushiest car salesman



Buying a car is a battle between you and the salesperson — and it isn't a fair fight.

Car salesmen do this every day, honing the high-pressure sales pitches they use to get you to buy — on their terms. The average consumer, on the other hand, enters this arena maybe once every five years.

Look the salesperson in the eye and say, 'Are you telling me that if I come back tomorrow, you can’t sell me the car?/

And there are a lot of moving parts. You have to haggle with salespeople over price and negotiate with lenders for an auto loan — all while trying to strike a deal for your trade-in. Mistakes will cost you.

So let me prepare you!

Take your time

Some car salespeople use time as a tool. They’ll draw out the process until you’re exhausted. The salesperson is going to be there all day. So if you plan on negotiating, don’t be afraid to set aside an entire day to spend at the dealership, and bring something to occupy your time while you wait out the salesperson or sales manager to counter-offer.

But you also don’t have to go through the entire process in a single day. It is fine to take multiple days to make a decision.

Don't get held hostage

When you go to the dealership, don’t get held hostage. Say: “Give me your best out-the-door price.” Then, if the salesperson offers to go back and forth negotiating with the manager, tell him to text or email you the results.

Or you can immediately establish control of the process by saying something like, “I’m here for a test drive. Tomorrow, I’ll come back and talk numbers.”

Keep your cards close to your chest

Some car salespeople receive extensive training in how to break down the needs and vulnerabilities of prospective customers. Their quick assessment of customers allows them to tap into scripted questions, lead the process, and close the sale.

Car salespeople are very specifically trained in how to persuade people. Understand what you want and how the salesman could take advantage of your weaknesses in negotiating.

One question you might hear is “How much are you looking to spend per month?” If you announce that up front, it will skew the process. It leaves you vulnerable. Insist on talking numbers after you test-drive the vehicle and are in the process of signing paperwork.

It’s fine to have car salespeople help answer some questions, but remember that they may use information against you, including vanity, family needs, or safety priorities, to upsell you on a more expensive car or options package.

Establish purchase price before you talk trade-in

Break down the purchase and keep your trade separate. The process should been done in stages and focus on only one at a time. Start with the car you want, then move to price negotiation, and leave add-ons and trade-ins for a separate discussion.

Be prepared to walk away

What if the salesperson says that if you don’t buy the car today, you’ll miss the big sale, or someone else will come to look at the car? That’s a sales tactic known as the impending event.

Here they're counting on human nature: People get more interested in having something that they know someone else wants or already has.

Suppose you’re at the car dealership looking around, and you pick out a particular vehicle and the salesman breaks the bad news to you, saying someone else already has a deposit on that car or there’s a buyer who said she'd be back later today to pick it up. That’s usually followed by the invitation to put a down payment on it or buy it right now before the other person comes back. They want you to spring for the purchase right then and there.

Remember, you can find that identical car elsewhere, whether at another dealership or on the internet. You can also simply buy something else.

So look the salesperson in the eye and say, “Are you telling me that if I come back tomorrow, you can’t sell me the car?” In other words, your best defense is to simply walk away or at least be prepared to do so. There are others cars available.

Say 'no' to the porcupine close

The "porcupine close" is a strategy where the seller “sticks” the potential buyer with a question. It could be, “If I could get you this monthly payment, would that be what it takes to get you to buy this car today?” Or “If I can get this in midnight blue, would you be willing to buy this today?”

Just say "no." Instead, tell the salesperson you are shopping around with several dealers to find the best overall deal. Once you compare your offers, you plan to make a buying decision.

Call out the Ben Franklin close

The "Ben Franklin close." Here’s how it works: The salesperson draws a line down the middle of a piece of paper, listing reasons to buy the car on one side and reasons not to buy on the other side. This is a very common sales gimmick in the auto industry and elsewhere.

You want to focus on the numbers you care about during this tactic. This is your monthly payment, your down payment, and your auto loan’s length, interest rate, and overall cost.

Know what those numbers should be, according to your budget, before you go into the dealership, and make sure you stick to those numbers. And don’t forget the insurance costs, which have increased lately.

The best way to defuse this tactic is to call out the salesperson by saying “That’s the Ben Franklin close.” Doing so will likely create an awkward moment with the salesperson, but it will also prevent the tactic from continuing. It’s a very sharp move on your part.

Deflect "choice" questions

A good car salesperson will never ask yes or no questions because they don’t want to give you a chance to say no. You will be offered a choice between two things, like whether you would prefer a model in blue or red.

Take a lesson from the political arena. Deflect the question by responding with a noncommittal answer, like saying you’re interested in a variety of colors, before switching to a different topic.

Beware the finance manager upsell

The finance manager is one of the most skilled people at the dealership. He will recommend that you pile on a bundle of extras that you don’t need. Because you’re spending a lot of money on the car, you may be encouraged to buy interior stain protection, anti-theft devices, rustproofing, and an extended warranty.

To ensure additional costs don’t add up, go line by line through your bill, looking for dealer fees you can negotiate down or avoid altogether. Some common ones to look out for are vehicle preparation fees, title fees, and gap insurance.

Know what you want and need before going to the dealership, and stick to your mission. You should ideally already have financing lined up, so constantly remind the finance manager that you have a set budget and you are not flexible.

Prepare to fight for your money

Salesmen are usually under pressure to maximize the profits on each vehicle they sell to increase their commission, and this influences how they interact with you.

The more a car salesmen convinces you to pay for a vehicle, the more profit he makes. The commission may be as high as 25% of the vehicle’s final sales price.

In addition, the dealership management offers bonuses for selling cars that may have been sitting on the lot. There are still more bonuses from the car manufacturer, called holdback, for salesmen or the dealership when meeting a sales quota on a particular model year or vehicle model.

Understanding the most common tactics will help you stay confident during negotiation. But it’s not the only tool you have. Research multiple vehicles, know the value of your trade-in, and get financing before you go to the dealership. Check with a credit union for low rates.

You don’t need to be a pro; you just need to be firm on how much you’re willing to spend and what you really need. As I always say, knowledge is power.