Tax Refund Season Boosts Used Vehicle Sales

Used-vehicle inventory opened March at the lowest level since October 2023, according to the Cox Automotive analysis of vAuto Live Market View data released March 15.

The total supply of unsold used vehicles on dealer lots – franchised and independent – across the U.S. stood at 2.27 million units as March opened, up nearly 9% from a year ago but down from the revised 2.33 million units at the start of February.

The start of spring fever and tax refund season brought a healthy increase in new and used vehicle sales, which dramatically brought down days’ supply. Total days’ supply at the start of March fell to 44, compared with the revised 53 at the beginning of February, a 20% decline. It nearly matches what we saw a year ago, reflecting only a 2% increase year over year.

The Cox Automotive days’ supply is based on the estimated daily used retail sales rate for the most recent 30-day period, ending March 4, when sales were 1.55 million units, the highest for a 30-day period since April 2020. Used-vehicle sales in this timeframe were up 6% from a year ago.

The average used-vehicle listing price was $25,151, down from a revised $25,653 at the start of February and down 3% from the same time in 2023. Interestingly, used vehicles priced above $35,000 had the highest sales, with 302,954 units sold, but days’ supply remains high at 52.

In contrast, vehicles priced between $15,000 and $20,000 had the next highest level of sales, at 286,452 units sold, with 39 days’ supply. The healthy sales of lower-priced vehicles suggests that affordability remains challenging for many consumers, and supply is more constrained at lower price points. Domestics showed strength in the used-vehicle market as Ford and Chevrolet both outsold Honda and Toyota.

Originally posted on Automotive Fleet