A customer browses at a used car lot in Glendale, California on February 15, 2023.
Tama Mario | Getty Images News | Getty Images
DETROIT — Used car prices are expected to fall more than previously expected this year, as rising gas prices and widespread inflationary costs hit Americans’ pockets.
Cox Automotive on Wednesday cut its full-year forecast for its Mannheim Used Car Value Index from a 2% rise to just 0.2%. This small increase marks the third consecutive year of relatively flat pricing, after a significant rise during the pandemic and subsequent decline.
The downward revision in forecasts follows a 1.95% decline in the index from July to September, including a 0.6% decline in September compared to the same month last year. September was the first time since March 2025 that the monthly index did not fall below a year ago.
“As we enter the fourth quarter, interest rates are rising and consumer sentiment is weakening, but the wealth effect from strong and sustained growth in financial assets provides some offsetting cushion,” Jeremy Robb, chief economist at Cox Automotive, said in a release.
The historical average for the Mannheim Index is up about 2.3% year over year. Unadjusted wholesale used car prices fell 1.2% in September from a year earlier and were down 1.3% from August as depreciation accelerated in the third quarter, Cox said.
This index is a closely monitored measure of used car prices that tracks the prices of used cars sold at wholesale auctions in Manheim US. Retail prices for consumers traditionally track changes in wholesale costs.
Cox noted that electric vehicle sales and off-lease numbers continued to rise, and the value of EVs and smaller, more fuel-efficient vehicles rose during the quarter, reshaping the dynamics of the used car market. The company says this is low compared to the poor performance of heavy-duty trucks and SUVs.
“The first half of this year actually saw higher than usual increases despite higher fuel prices. However, wholesale prices are feeling the pinch as the Middle East conflict continues, diesel prices are at record highs, interest rates are rising rapidly, and both business and consumer concerns are growing,” Robb said.
The national average gasoline price in September was $4.33 per gallon, leading to the co-location of smaller, more fuel-efficient cars with larger cars. That was 50 cents higher than the September record of $3.83 in 2023, according to AAA.
Cox said retail demand for used cars is relatively healthy, but the price changes appear to indicate dealers are reaching a ceiling on what they can charge consumers.
The average list price for a used car was $27,239 in August, Cox said. This compares to new cars with an average price of over $50,000.
The majority of U.S. consumers buy used cars because they are more affordable than new cars.
