Report: CarGurus Finds Affordability & Fuel Efficiency Shaping Auto Market

Digital auto platform for shopping, buying, and selling new and used vehicles, CarGurus, released its 2025 Mid-Year Auto Market Review. The analysis highlights the impact of tariff uncertainty, shifting inventory dynamics, and evolving consumer preferences on the new and used vehicle market.

“So far this year, the auto market has been shaped by dramatic shifts in consumer behavior fueled by shifting policies and economic uncertainty,” said Kevin Roberts, director of economic and market intelligence at CarGurus. “These pressures have amplified what car shoppers demand most: affordability and efficiency. While vehicle prices have mostly held steady despite tariffs, it remains to be seen how long the current balance of pricing and demand can last, especially as value-driven options become harder to find.”

Highlights from the 2025 Mid-Year Auto Market Review

• Tariff-driven sales surge has reduced affordable new inventory: New vehicle sales spiked 48% year-over-year in the days after the March tariff announcement as buyers raced to beat potential price increases. While sales demand has since normalized to more seasonal patterns, the affordable segment is showing lasting impacts. Listings for new cars under $30,000 have dropped by 15% since late March, with compacts and crossovers like the Honda Civic, Buick Encore GX, Jeep Compass and Mazda CX-30 seeing the steepest declines.
• The average new vehicle price is holding steady: While over 60% of new vehicle listings today are post-tariff inventory, the average new car price has remained relatively stable at approximately $49,600. Model-level price changes tell a more nuanced story, with luxury SUVs seeing some of the largest price increases since tariffs went into effect in April and electric vehicles (EVs) posting the biggest price decreases.
• Aged new car inventory may offer value: Despite the spring sales surge, 2024 and older model-year vehicles are maintaining a high share of inventory, approaching levels not seen since 2020. At mid-year, over 7% of new car listings were 2024 or older, with Ford trucks and SUVs among the top models with older model year supply, creating a chance for shoppers to find a potential deal on pre-tariff inventory.
• Used inventory reaches multi-year highs, but value has been redefined: Despite abundant used car supply, 3- to 4-year-old models—the sweet spot for value-conscious buyers—remain scarce and priced at a premium due to lingering effects of pandemic-era production disruptions. For those in the market for a used car under $20,000, options are increasingly older and higher mileage. At both ends of the age spectrum, however, fuel-efficient models (spanning hybrids, EVs and compacts) lead the pack in demand.
• Hybrids stand out for pricing and demand: Hybrids continued to lead new vehicle sales growth in 2025, buoyed by strong demand and attractive pricing. Average list prices for new hybrids decreased by about $1,400 year-over-year, helping drive a 43% increase in retail sales compared to 2024. Notably, hybrid and gas models are now the most commonly cross-shopped combinations, as shoppers increasingly prioritize practicality and affordability.