The used car market is seeing higher-than-expected demand, leading to a 2.5% rise in wholesale values in January (the largest increase since 2021), according to data from Cox Automotive. Many consumers kept from purchasing a used car during the initial elevated prices era when chip shortages began. Those consumers are now returning since costs have decreased and availability has begun to recover.
Trend setter. The Manheim Used Vehicle Value Index, which tracks prices of used vehicles sold at US wholesale auctions, demonstrates how used vehicle prices act as a barometer for inflation. Thankfully, it's trending toward normal as the used vehicle market begins to stabilize. It’s finally beginning to resemble its pre-pandemic state, with inventory holding steady and prices dipping from their record highs. Studies forecast the upward trend in used car sales will continue through Q1 and into Q2.