New, used prices move in different directions
Canadian car buyers faced a shifting market in 2025 as tariffs and changing supply influenced prices and availability, but there are early signs of stabilization emerging, particularly for new vehicles.
AutoTrader’s latest research found average new vehicle prices fell nearly three per cent year over year to $63,665 as of November 2025. Used vehicle prices remained elevated versus pre‑pandemic levels, averaging $35,494, up more than two per cent year over year, though pressures are easing.
Improved availability has helped, supported in part by reciprocal Canadian tariffs that previously slowed exports to the U.S., which reduced upward price pressure.
New vehicle inventory is generally healthy, AutoTrader reported, even as overall supply is slightly down from last year. Availability varies by brand, reflecting differences in demand, tariffs and limited imports. These brand-level shifts can ripple through the market, creating uneven pricing and choice for buyers.
Used inventory has been gradually increasing but is expected to remain constrained until mid to late 2027. Recent gains have come from higher new car sales, increased trade‑ins, limited exports tied to tariffs, slightly softer demand and more young vehicles re‑entering the market. Those factors have helped replenish stock after years of reduced supply and fewer off‑lease returns. Together, rising availability in both new and used segments is easing price pressure and giving buyers more options, although the market remains in transition.
Tariffs have had a clearer impact on the used market than on new vehicles, according to AutoTrader. Early fears of sharp increases in new vehicle prices did not play out, in part because strong inventory helped stabilize costs.
In contrast, the used market absorbed the effects sooner, with tighter supply and heightened demand driving price volatility, similar to patterns seen during the COVID‑era disruptions. As uncertainty around new vehicle costs grew, more consumers shifted to used models, amplifying those swings.
AutoTrader noted that outcomes varied by automaker, as differences in inventory, demand and pricing strategies created an uneven landscape across brands. That variation underscores how individual brand decisions can quickly move broader market conditions.
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