Used vehicle prices predicted to remain steady in 2025 following pandemic market fluctuations.

• In 2025, it is predicted that used vehicle prices will remain stable, following a period of fluctuating pricing that began to stabilize in the previous year.
• Cox Automotive predicts that wholesale prices for its Manheim Used Vehicle Value Index will increase by 1.4% by the end of the year compared to December 2024.
• In 2024, the increase this year will be compared to a 0.4% rise, despite drops of 7% and nearly 15% in 2023 and 2022, respectively.

In 2025, it is predicted that used vehicle prices will remain stable after fluctuating greatly for several years, with a gradual decrease in volatility beginning in 2024.

Cox Automotive predicts that wholesale prices for used vehicles sold at its U.S. auctions, as tracked by the Manheim Used Vehicle Value Index, will increase by 1.4% by the end of the year. While pricing will fluctuate monthly due to selling seasonality and other factors, it is not expected to be as significant as in previous years, according to Cox.

In 2024, the increase in prices would be compared to a 0.4% rise, following drops of 7% and nearly 15% in 2023 and 2022, respectively, due to inflated prices during the Covid-19 pandemic. The index used for vehicle prices during that time showed historically high rates of 46.6% in 2021 and 14.2% in 2020.

During that period, the availability of new vehicles reached record lows due to supply chain and parts issues that halted vehicle production. The Biden administration acknowledged that the increase in used vehicle prices played a significant role in inflation during that time.

While the stability in pricing is beneficial for potential car buyers, used vehicle prices remain higher than they were prior to the pandemic. Despite retail prices typically mirroring changes in wholesale prices, they have not decreased as rapidly as wholesale prices in recent years.

"Cox Automotive senior director of economic and industry insights, Jeremy Robb, stated during a call on Wednesday that they will be ending some of the pandemic-related moves. He added that there will likely be some volatility in their forecast."

According to Cox data from 1997 to 2022, excluding the outlier years of 2021 and 2022, the average index move at the end of each year is an increase of 2.3%.

Cox stated that a typical month-to-month change in the index throughout the year is only 0.2%.

The average price of a used vehicle in December was $25,565, a slight increase from the previous month's average of $25,493, but a 3% decrease from the same month the previous year.

According to Cox Automotive, the forecast for used vehicle sales in 2025 is expected to increase by 1% to 37.8 million, with 20.1 million in retail sales, representing a 1.2% increase.