Cox Automotive reduced its annual forecast for the Manheim Used Vehicle Value Index to a 0.2% increase, signaling a sharper slowdown in the used car market than previously predicted. The revised projection reflects mounting pressure from record fuel costs, climbing borrowing rates, and a consumer shift away from large vehicles.

Wholesale prices already dropped 1.3% from August and fell 1.2% compared to last September. Depreciation accelerated through the third quarter, pushing the index 1.95% lower between July and September. September marked the first time since March 2025 that monthly values did not exceed their year-earlier levels. The historical annual gain for the index sits around 2.3%.

Buyer preferences are actively reshaping inventory values. Electric vehicle sales and off-lease volumes are rising, lifting prices for EVs and smaller fuel-efficient models. Large trucks and SUVs are struggling to keep pace as shoppers weigh rising operating costs against everyday commuting needs.

Retail demand remains steady, but dealers appear to have reached a pricing ceiling. The average listed price for a used vehicle stood at $27,239 in August, while new vehicles average more than $50,000. Most U.S. buyers still turn to the used market for affordability, yet higher interest rates are testing patience and limiting how much dealers can charge.

"As we enter Q4, interest rates are rising, consumer sentiment is falling, and yet a wealth effect from strong and sustained financial-asset growth is providing some offsetting cushion. Many metrics we watch are converging back toward pre-pandemic norms, but the road to get there has been anything but smooth," Jeremy Robb, Cox Automotive chief economist, said. The first half of the year delivered stronger-than-normal price growth despite rising fuel costs, but sustained diesel spikes and rapidly climbing interest rates have now forced wholesale values to adjust.