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The price of a used car got marginally cheaper in May, down 1.4% from April, though still 4% higher than this time last year. That’s according to Cox Automotive’s Manheim Used Vehicle Value Index, which monitors prices at U.S. wholesale auctions. During the same time frame, the national inventory of used vehicles dropped 10%, to 2.8 million vehicles, as cautious consumers cling to the their cars amid the post-pandemic slump.
In April, Goldman Sachs (GS-1.29%) forecast the price of new cars rising between $2,000 and $4,000 due to new tariffs imposed by the Trump administration on steel and aluminum — and prices of new vehicles always trickling down to the used market.
April marked the highest prices for used vehicles since October 2023, which may have been fueled by fears of tariff-induced price hikes. Used-car prices reached an all-time high in January 2022, riding a sharp upswing that began during the pandemic. They’ve fallen almost 20% since then.
Meanwhile, the number of Americans who are struggling to make their car payments hit its highest number in decades, a troubling sign for the overall economy.