The U.S. used car market gained momentum in March as consumers increasingly turned to pre-owned vehicles in response to persistently high new car prices. Sales activity rose sharply during the month, even as dealership inventory continued to shrink nationwide.
Data from Cox Automotive shows that approximately 1.62 million used vehicle transactions were completed through retailers in March, up significantly from 1.37 million in February. Despite the monthly surge, sales were still 2.9% lower compared to the same period a year earlier.
On a daily basis, used car sales climbed 7% month over month, reaching their highest level in the past year. While March is traditionally a strong period for the used vehicle market, this year’s performance exceeded levels recorded in both 2023 and 2024.
Rising demand has put noticeable pressure on supply. Combined inventory at franchised and independent dealerships fell to about 1.95 million units in March, marking the lowest level since 2019. This represents a 5.9% decline year over year and an 8.3% drop compared to February.
Tightening supply conditions are also reflected in the days’ supply metric, which dropped to 37 days—the lowest since 2021—and extended a three-month trend of declining inventory.
As availability tightened, prices edged upward. The average listing price for a used vehicle reached $25,390 in March, slightly higher than the previous month but still within a relatively stable range observed over the past year. Prices have generally fluctuated between $25,200 and $25,970, remaining well below the average cost of a new vehicle, which exceeds $50,000.
Lower-priced vehicles remain particularly scarce. Inventory for used cars priced under $15,000 stood at just 27 days of supply, underscoring ongoing affordability challenges for budget-conscious buyers.
Brand concentration in the market remains strong. Ford, Chevrolet, Toyota, Honda, and Nissan collectively accounted for nearly 51% of total used vehicle sales in March, reinforcing the dominance of established automakers in the segment.
Overall, the latest data highlights a market defined by steady demand and constrained supply, with used vehicles continuing to serve as a critical alternative for consumers priced out of the new car market.
