Canada’s new and used vehicle markets held up better than expected during the first half of 2026, as improving inventory and easing prices helped support demand despite continued economic uncertainty, according to AutoTrader’s latest Price Index.
The report found that affordability remains the primary influence on vehicle purchases, while ongoing CUSMA negotiations are affecting consumer sentiment more than overall buying intentions.
Average new vehicle prices declined 2.2 per cent year over year to $63,016 in June, while used vehicle prices fell 2.6 per cent to $36,690. AutoTrader said prices continue to normalize, although they remain high by historical standards.
New vehicle sales declined 1.3 per cent during the second quarter and were down 2.6 per cent through the first half of the year. Used vehicle sales fell an estimated 2.5 per cent in the quarter and 1.0 per cent year to date. Both markets posted sales gains in June.
AutoTrader said the softness in the used market has been concentrated largely among subprime consumers, whose purchasing power has been more heavily affected by higher living costs. Prime buyers, by comparison, purchased more used vehicles during both quarters of the first half than they did during the same period last year.
The report also found that CUSMA uncertainty is prompting some shoppers to adjust their plans rather than abandon them. Some consumers are considering more affordable vehicles, delaying purchases or moving from new to used, but the trade negotiations have not materially changed overall purchase intentions.
Inventory conditions also continued to improve. New SUV inventory increased 24.2 per cent year over year, while car inventory rose 21.9 per cent and truck inventory climbed 14.1 per cent. AutoTrader said availability still varies significantly by brand, with some manufacturers carrying tighter supplies and others using incentives to move higher inventory levels.
Used vehicle inventory remained relatively stable, with days’ supply improving to 44 days from 41 a year earlier. However, affordable used EVs remain in relatively short supply, and average used EV prices increased 0.4 per cent year over year.
Overall, AutoTrader described the market as more balanced than it was during the recent period of severe supply constraints, with activity increasingly supported by underlying consumer demand.
