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Just when buyers hoped the used-car market might finally catch its breath, prices have edged back to levels not seen since the summer of 2023. And this time, electric vehicles are helping push the market higher.
According to Cox Automotive, the Manheim Used Vehicle Value Index rose to 215.3 in March, up 6.2 percent from a year earlier and 1.4 percent from February. That is a notable jump for a month that is usually fairly calm. But this is not a normal market. Dealers are paying more at wholesale auctions, and those costs almost always find their way to the showroom floor.
The average listed price of a used vehicle stood at $25,287 in February, while the average new car price topped $49,100. That gap keeps many buyers firmly in the used market, especially as new-car prices continue climbing and household budgets remain under pressure.
Demand has not cooled either. Strong tax refunds gave the market an early-year jolt, and auction conversion rates reached 68.2 percent, well above historical norms. In plain English, dealers are still competing hard for inventory. Supply remains tight, too. Wholesale stock is sitting at just 24.5 days, while retail inventory has slipped below 40 days. That kind of squeeze tends to keep prices firm.
EVs Are Moving Faster Than Gas Cars
The biggest surprise is the electric-car market. Even with a flood of off-lease EVs entering the used-car pipeline, values are rising faster than those of gasoline-powered vehicles. The EV index jumped 7.9 percent year over year and 3.7 percent from February. Higher fuel prices, now above $4 per gallon in some areas, are clearly nudging more shoppers toward electric models, whether they planned to go that route or not.
Luxury vehicles are leading the rally, while compact cars and trucks are lagging behind. Still, every major segment is posting gains compared with last year. Jeremy Robb, chief economist at Cox Automotive, said the market typically peaks by the end of March and suggested values could stay firm into summer as more consumers wait on tax refunds. He also noted that broader economic conditions remain surprisingly resilient, even with global tensions weighing on sentiment.
There are a few forces still tightening the market. Lower new-car sales are reducing trade-ins, which means fewer fresh vehicles are flowing into the used market. Rental fleets are also up 7.5 percent year over year, adding another layer of pressure across multiple segments.
Cox Automotive expects used-car prices to stabilize later in the year, but for now the market is holding up better than many expected. The company has slightly raised its 2026 used-vehicle sales forecast to 20.4 million units, although that still represents a decline of about 1 percent from 2025.
Source: carscoops
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