Used car prices fall for the first time this year and EV interest rises as gas prices spike

Customers browse in a used car lot in Glendale, California, Feb. 15, 2023.

Mario Tama | Getty Images News | Getty Images

DETROIT — Used car prices fell in April for the first time since October as gas prices rose amid the Iran war.

Cox Automotive’s Manheim Used Vehicle Value Index — which tracks prices of used vehicles sold at its U.S. wholesale auctions — decreased 1.6% last month compared with March and was up 1.8% compared with the same month a year earlier.

Cox said affordability remains a key concern for buyers and that concern is driving increased demand for older vehicles and all-electric vehicles at Manheim auctions.

Gas prices at the end of April were up $1.12 per gallon compared with a year earlier to a national average of $4.30 a gallon, according to AAA. They’ve continued to rise since, with the national average hitting $4.56 as of Thursday.

“The conflict in the Middle East has now been ongoing for two months, and while energy prices backed off a bit in mid-April, they have reaccelerated to the upside: the price of gas just hit a high for the year and is up 47% since the end of February,” Cox Automotive chief economist Jeremy Robb said in a release. “Those higher prices are soaking up a lot of the extra money in consumers’ pockets, and currently there’s no end in sight.”

Retail prices for consumers traditionally follow changes in wholesale prices, which Cox forecasts to rise at a historically stable rate of about 2% this year. The average listed price of a used vehicle was $25,390 as of March, according to Cox. That was up roughly $100 from February.

The average listing price for a used EV remains more than $9,200 higher than the overall market, but new and used vehicle retailers have said the rapid rise in gas prices has led to higher EV sales following a slowdown after the end of federal incentives last year by the Trump administration.

Manheim’s electric vehicle index was up 7.2% year over year and up 1.4% from March.

The report of April’s lower pricing follows a strong start to the spring selling season, fueled by many consumers spending higher tax refunds to purchase or finance used vehicles, Cox said.

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