The news predicts that car prices could be volatile through much of 2025, but the actual trend in car prices has been good for shoppers in recent weeks. The price of the average used car dropped in January and is likely to fall further soon.
We track future used car prices in part by watching the prices that dealers pay for used cars at auction. A shift in these wholesale prices tends to become a shift in retail prices after about six to eight weeks.
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That news comes from Kelley Blue Book’s parent company, Cox Automotive, which also owns car auction giant Manheim — where car dealers go to buy used cars they later sell. Manheim’s Used Vehicle Value Index now sits 0.1% lower than it did a year ago.
The tiny tick down is news because Americans have started receiving their 2025 tax returns, which typically kicks off a surge in used car shopping.
“Tax refund season drives the ‘spring bounce’ in wholesale markets, and it looks to have started off a bit slower this year, before ramping up at the end of February. The retail supply of used units is tighter than it was at this time last year,” says Cox Automotive Senior Director of Economic and Industry Insights Jeremy Robb.
Used compact car prices declined the most last month, falling 4.8% compared to 2024 numbers. Pre-owned midsize cars were a good value, too, falling 3.5%. Used luxury car prices increased 1.2% during the month.