The average listed price for a used vehicle in Canada climbed to $37,900 at the end of April, a significant 9-percent increase from the $34,750 recorded at the beginning of that month.

These figures come from the Canadian Black Book, which uses a 14-day rolling average to track the market. According to Daniel Ross, the outlet’s senior manager of industry analysis, the surge in pricing is due to sustained demand as Canadian dealers anticipate expected price increases on new vehicles.

And those increases, of course, are the expected consequence of the U.S. auto tariffs and Canadian retaliatory measures implemented in April.

Wholesale market: Quiet but stable
Unlike the retail price surge, the wholesale market remained stable in April. Increases observed in the light truck segments were offset by decreases in passenger cars. However, Daniel Ross emphasizes that the absence of a decrease is, in itself, excellent news, in a context where the wholesale market normally depreciates weekly.

Trade war: Cascading repercussions
Growing demand for used vehicles is not a surprise. Many analysts predicted that if American tariffs were implemented, many buyers would turn away from new vehicles.

The AutoTrader.ca outlet confirms that activity in the used car market remained “very hot” throughout April.

We know that the used car market was already under pressure since the pandemic, with limited supply. The arrival of buyers deterred from new cars due to price increases risks amplifying the strain on inventory.

An AutoTrader analyst adds, “Current inventories of new vehicles are temporarily protecting Canadian consumers. But this protection is limited in time.”

A short grace period
James Hamilton, managing director of the Used Car Dealers Association of Ontario, agrees. He believes that the reprieve offered by current inventories will be brief.

“Once these vehicles are sold, prepare for sticker shock on new vehicle prices.”

An increase in new car prices will create cascading pressure on the used car market, both on prices and inventory.

Exports under pressure
In recent years, around 300,000 to 400,000 Canadian used vehicles were exported to the U.S. each year — a tenth of the market, according to AutoTrader. Those exports were driven by a favourable exchange rate for Americans.

But the new tariffs—which affect both new and used vehicles—are disrupting the normal dynamic. Daniel Ross notes that American buyers have slowed their pace at Canadian auctions, adopting a more strategic approach, focusing on trucks, sports cars and luxury models.

Good news for Canadians?
A decrease in exports logically means that more used vehicles — particularly recent models from 1 to 5 years old — will remain in Canada. That could stabilize, or even reduce prices here.

The rapid price increase in April occurs within a complex and volatile commercial context. Dealers are seeking to adapt to a new tariff reality, while consumers will need to keep an eye out to avoid surprises in both the new and used car markets.

Charette, B. (2025a, May 20). Used vehicle prices rose by 9 percent in Canada in April: Car news: Auto123. auto123.com. https://www.auto123.com/en/news/used-vehicle-pricing-increased-canada-april-tariffs/72777/

Strong March in advance of tariffs

Spurred by the threat of looming tariffs, we observed an active automotive market in March. AutoTrader.ca saw an uptick in user activity: visits and engagement with listings both for new and used vehicles were up substantially and car shoppers – compared with the pretariff period and same time last year – have been sending more sales inquiries to dealers and private sellers across all our platforms.

Canadian car shoppers rushed into the new car market while inventory was available and before prices could rise. And, as our research showed in early February, many used car buyers accelerated their purchases, while some new car shoppers switched to used vehicles in anticipation of price increases.

Unseasonal uptick in used car prices

Typically, what we see during ‘normal’ times, is used vehicles start with an established base price and decline throughout the year. March marks the start of the spring buying season and usually brings more buyers into the market with increased price competition. For example, in 2019 (the last ‘normal’ year), used car prices dropped 0.7 per cent in March month over month; in 2024, they were down 2.1 per cent.

This year, however, the market saw a slight uptick – a 0.3 per cent increase to $36,823 – driven by tariff-related demand and expectations of pandemic-like price surges.

More buyers entered the market and some shifted from new to used vehicles. AutoTrader has a feature that monitors price drops for vehicle listings over time and our analysis of it shows 23-per-cent fewer listings with price reductions in March alone. This trend has already continued well into April.

A silver lining for used car inventory

AutoTrader estimates 1.5 million fewer new cars were sold between 2020 and 2023, which is now affecting the used market, as those vehicles simply never entered the buy/sell pool.

The weak Canadian dollar has also led to more used vehicles being exported to the United States. An AutoTrader analysis shows a negative correlation between used car exports and the strength of the Canadian dollar: when the dollar is weak, more cars head south of the border. Now, with tariffs in place on both new and used vehicles, there’s a potential silver lining: fewer cars will be exported, allowing for more used vehicle inventory to stay in Canada. This could help ease supply constraints and relieve some pricing pressure for Canadian buyers.

New car inventory: healthy supply, for now

New car supply is relatively healthy, with 67 days’ worth of inventory (60 days is considered ‘healthy’ by industry standard). This buffer likely contributes to why new car prices have remained flat so far in 2025, though it’s not by a significant margin.

It’s also important to note that the 67-day figure is an average: some brands have more than 100 days of supply, while others have less than 30 days, so we may see more fluctuation in months to come.

What’s next?

With so much uncertainty around tariffs, it’s difficult to predict exactly what will happen next. For now, the industry outlook remains similar to what it was before tariffs. If this is a short-term disruption, the market – especially for new cars – has enough supply to absorb some volatility. However, used car supply is more challenged and demand is on the rise, which is why we’ve already seen some price movement.

Sales forecasts vary widely, so rather than wait to speculate, we suggest that if Canadian car shoppers are active in the market and have found the right vehicle, that they act promptly to secure it.

Resilience in uncertain times

As we face these recent tariffs, it’s worth remembering that the Canadian automotive market has weathered storms before. We endured the 2008 global financial crisis and navigated through the pandemic disruption earlier this decade, and adapted each time. While today’s volatility is challenging, it’s also an opportunity to learn and respond. We remain confident in our industry’s strength and resilience – and in Canadians’ determination to move forward together, no matter what the road ahead brings.

Akyurek, B. (2025, May 6). How tariffs are Shaping Canada’s automotive market so far. The Globe and Mail. https://www.theglobeandmail.com/drive/mobility/article-how-tariffs-are-shaping-canadas-automotive-market-so-far/