April 2025 Mid-Month Analysis: How Tariffs are Shaping Pricing, Inventory, and Demand

Just weeks after the March 26th announcement of new tariffs on imported vehicles and select auto parts, and with those tariffs taking effect on April 3, we’re already seeing major ripples in the market. Our Q1 2025 Quarterly Review flagged potential disruptions, and now, the early data is in.

Here’s what’s happening right now:

• New and used sales surge: After the March 26th announcement, consumer urgency went on the upswing. Before the announcement, new vehicle sales were trending toward a healthy 10% annual increase. After, that surged to 31% year-over-year growth compared to the same time period in 2024. Similarly, used car sales were trending toward a 7% year-over-year increase before surging to a 19% year-over-year increase after the news broke.
• New inventory most impacted: Despite the increased demand, used car inventory has remained mostly stable with the CarGurus Vehicle Availability Index showing inventory up 1% over March 26th levels and market days supply (MDS) holding steady. New, on the other hand, is showing the effects of rising demand, combined with delayed production and shipments. New vehicle inventory is down 7% compared to March 26th, although new MDS has stabilized after seeing a significant dip in the days following the announcement.
• New vehicles also seeing larger price changes: Similar to inventory dynamics, used inventory pricing has remained mostly stable at an average list price of $28,400. This is a slight $126 increase compared to March 26th and -0.8% lower compared to a year ago. The average new car price has already increased by $600 compared to the March 26th rate, to $49,900, up 0.3% from the same time last year.
• Hybrids showing the tightest availability: Imported vehicles with the lowest MDS are skewing toward those offering practicality and affordability. In our analysis of models originating outside of the U.S. with the lowest MDS, many offer an average list price of under $40,000 (such as the Honda Civic and Volkswagen Jetta) and include popular hybrids (like Toyota’s RAV4 and Corolla).