United States Used Car Market

United States Used Car Market Size:

The United States used car market size reached 36.1 Million Units in ​2023​. Looking forward, IMARC Group expects the market to reach 50.36 Million Units by ​2032​, exhibiting a growth rate (CAGR) of 3.50% during 2024-2032. The market is witnessing resilient growth boosted by heightened customer demand for used cars, proliferating online sales sector, and rapid technological advancements. Furthermore, manufacturers are emphasizing on strategic collaborations and innovation to capitalize on key opportunities and maintain competitive edge.

United States Used Car Market Analysis:

• Major Market Drivers: The market is driven by several factors, such as the rising cost of new vehicles, which establishes used cars as more appealing option for economically minded buyers. In addition, the availability of certified pre-owned programs, which provide vehicle history reports and warranties, improves customer confidence in buying used vehicles. The rising popularity of digital marketplaces and online platforms is also bolstering convenience and accessibility for customers, permitting them to compare options and prices more easily. Moreover, the heightening demand for hybrid and electric vehicles (EVs) is boosting the turnover of conventional gasoline-powered vehicles, thereby increasing the United States used car market share.
• Key Market Trends: Some of the key trends observed in the market include an amplifying inclination towards online sales platforms that offer customers with a more transparent and streamlined purchasing experience. There is also an escalating demand for certified pre-owned vehicles, boosted by the assurance of extended warranties and quality. In addition, the market is witnessing a surge in the sale of used hybrid electric vehicles, highlighting comprehensive trends towards environmental awareness and sustainability. The effect of disruptions in the supply chain networks of new car market has further propelled the demand for used vehicles, as consumers seek cost-effective alternatives amid rising new car prices, ultimately bolstering the United States used car market revenue.
• Competitive Landscape: Competitive analysis such as market structure, key player positioning, top winning strategies, competitive dashboard, and company evaluation quadrant has been covered in the report. Also, detailed profiles of all major companies have been provided. 
• Challenges and Opportunities: Some of the key challenges frequently faced by the market include inventory scarcity due to elevated demand and supply chain disruptions and fluctuation in the vehicle prices. Whereas key opportunities for growth include proliferation of e-commerce platforms, which provide improved customer convenience and reach. In addition, the heightening interest in hybrid as well as electric vehicles offers a potential growth area, as customers seek more sustainable mobility solutions. The emphasis on enhancing trust and transparency in the used car buying network, further propels market opportunities regardless of ongoing challenges.

United States Used Car Market Trends:

Rising Demand for Certified Pre-Owned Vehicles

The market is experiencing a notable surge in demand for certified pre-owned (CPO) vehicles. CPO programs provide customers the guarantee of reliability and quality, supported by intensive inspections and warranties from manufacturer’s end. According to Cox Automotive Inc., a major U.S.-based company, CPO sales reached 228,237 units in December 2023, while full-year CPO sales exceeded 2.6 million units, registering a 6.6% increase from 2022. With the rapid elevation of car prices, more buyers are preferring CPO vehicles as a cost-efficient alternative, while still leveraging the benefits of like-new condition and warranty extension. This trend is particularly robust among budget-conscious customers who demand value without compromising on performance and quality, further bolstering the growth of CPO sales across numerous automotive dealerships and brands. This growth ultimately contributes to a positive United States used car market outlook.

Rapid Expansion of Online Used Car Sales Platforms

The rapid expansion of e-commerce platforms for used car sales is revolutionizing the Unites States used car market. Major companies in the country, such as CarMax, Vroom, or Carvana are at the forefront in this digital shift, providing customers the convenience of purchasing, financing, and browsing used cars purely online. According to latest industry reports, Carvana sold 312,847 retail units in 2023, with a total revenue of USD 10.771 billion, while in the last quarter of 2023, the company had total revenue of USD 2.424 billion. This trend is further driven by rising buyer preference for contactless, hassle-free, and transparent transactions, especially since the pandemic. The popularity of such platforms is also boosted by technological advancements, allowing virtual tours, streamlined financing options, and thorough vehicle inspections, making online purchases more appealing and accessible to a broader consumer base, consequently bolstering the United States used car market growth.

Increasing Popularity of Hybrid and Electric Used Vehicles

The popularity of hybrid and electric vehicles (EVs) is soaring rapidly in the United States primarily due to escalating environmental awareness among consumers and increasing demand for cost-efficient alternatives to new EVs. According to industry reports, number of used EVs sold in United States increased from 283,000 in 2022 to 400,000 in 2023. Furthermore, the sales are projected to reach around 560,000 in 2024. Moreover, certain factors such as government incentives, rising fuel prices, and escalating awareness regarding environmental sustainability are further driving this trend. In addition, with the launch of more hybrid and electric vehicles in used car market, the prices are becoming more competitive, making them attainable to a broader range of consumers. This inclination is prompting used car online platforms and dealerships to proliferate their inventory of hybrids and EVs, addressing the evolving requirements of buyers and spurring the United States used car demand.

United States Used Car Market Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the market, along with forecasts at the regional and country levels for 2024-2032. Our report has categorized the market based on vehicle type, vendor type, fuel type, and sales channel.

Breakup by Vehicle Type:

• Hatchbacks
• Sedan
• Sports Utility Vehicle
• Others
   

The report has provided a detailed breakup and analysis of the market by vehicle type. This includes hatchbacks, sedan, sports utility vehicle, and others.

According to the United States used car market overview, hatchbacks is a popular segment in the market chiefly due to their fuel efficiency, versatility, and compact size. These vehicles interest urban drivers who favor easy parking and handling, as well as those seeking cost-efficient mobility solution. The demand for used hatchbacks is further bolstered by their lower maintenance and purchase costs in comparison to larger vehicles. In addition, the presence of certified pre-owned options improves buyer confidence, spurring constant sales within this segment.

Sedan continues to be a prominent segment in the United States used car market, preferred for their practicality, balanced performance, and comfort. These vehicles are especially prevalent among commuters and families, providing a seamless driving experience and capacious interior. Furthermore, the dip in new sedan sales has heightened the availability of used sedans, offering customers with more cost-effective options. The United States used car market report suggests that the broad range of models and makes in this segment further facilitates robust demand and a stable resale value in the market.

The sports utility vehicle (SUV) segment is thriving in the United States used car market and is majorly driven by buyers’ preferences for adequate cargo space, versatility, and higher seating position. SUVs particularly appeal to outdoor enthusiasts and families who demand a vehicle proficient in handling diverse weather conditions and terrains. According to industry reports, SUVs sales in the U.S. market increased from 48.5% in 2019 to 56.3% in 2023. The proliferating inventory of used SUVs, including full-sized, compact, and midsize models, addresses the diverse needs of consumers. Additionally, the United States used car market recent developments, such as advancements in technology and fuel efficiency, have improved the appeal of used SUVs, further aiding their sustained market expansion.

Breakup by Vendor Type:

• Organized
• Unorganized
   

A detailed breakup and analysis of the market based on the vendor type have also been provided in the report. This includes organized and unorganized.

The organized segment of the United States used car market is represented by large, well-renowned e-commerce and dealerships platforms. These vendors provide a regulated buying experience with certified pre-owned vehicles, transparent pricing and extended warranties. The presence of comprehensive after-sales services and recognized brands offers customers with an increased level of reliability and trust. According to the United States used car market forecast, the organized vendors are anticipated to profit from optimized operations, utilizing technology for customer relationship management, inventory management, and financing options, guaranteeing a professional and smooth buying process.

The unorganized segment consists of independent, smaller, private sellers and dealerships. These vendors generally operate without the same level of standardization or regulation as their organized counterparts. While this segment may provide reduced prices and more open-ended negotiation, it typically lacks the certified inspections, customer support, and warranties associated with larger dealerships. Customers in the unorganized market experience greater risks related to vehicle transparency, after-sales service, and quality, making comprehensive due diligence critical in these transactions.

Breakup by Fuel Type:

• Gasoline
• Diesel
• Others
   

The report has provided a detailed breakup and analysis of market by fuel type. This includes gasoline, diesel, and others.

The gasoline segment in the United States used car market is primarily driven by its extensive supply and reduced upfront costs in comparison to alternative fuel vehicles. According to the U.S. Energy Information Administration, in 2023, United States finished motor gasoline consumption averaged approximately 376 million gallons per day. Gasoline-powered vehicles provide enhanced flexibility for long-distance refueling and travel, which appeals to a wide range of buyers. In addition, the widespread network of gas stations across the country assures convenience for consumers, establishing gasoline vehicle as a preferred choice in the used car market irrespective of heightening interest in more environmentally sustainable options.

The diesel segment is represented by its appeal to buyers seeking long-term durability and fuel efficiency, especially for larger vehicles such as SUVs and trucks. Diesel engines are renowned for their exceptional towing and torque attributes, making them a preferred choice for consumers with specific performance requirements. Regardless of higher initial costs and stringent emissions protocols, diesel vehicles sustain a robust presence in the used car market due to their resilient longevity and performance.

Breakup by Sales Channel:

• Online
• Offline
   

A detailed breakup and analysis of the market based on the sales channel have also been provided in the report. This includes online and offline.

The online market segment has been witnessing significant growth, driven by buyer demand for transparency and convenience. Major digital platforms of the U.S., such as Carvana, Shift and Vroom, provide an optimized buying process, allowing customers to finance, purchase, and browse vehicles entirely online. As per industry reports, 48% of Americans initiate the car purchasing process online. The ease of analyzing detailed vehicle information and comparing prices has significantly contributed to the increasing popularity of online channels, particularly among tech-savvy customers. This segment is anticipated to continue growing as buyer preference and technology evolve, ultimately profiting the United States used car companies.

The offline market segment remains a crucial channel in the United States used car market, represented by conventional in-person transactions and dealership sales. Consumers frequently prefer offline channels for the chance to physically analyze vehicles, receive personalized service, and negotiate prices. Certified pre-owned programs, which are generally provided by dealerships, also influence the strength of this segment positively. Regardless of the rise of e-commerce platforms, offline sales continue to hold substantial market share, especially among buyers who prefer tangible experiences and direct interaction.

Breakup by Region:

• Northeast
• Midwest
• South
• West
   

The report has also provided a comprehensive analysis of the United States used car market by region, including Northwest, Midwest, South, and West.

The Northeast regional market for used cars in the United States is represented by soaring product demand chiefly driven by high urban populations and intense winter conditions that lead to recurring vehicle turnover. The region's proximity to key ports also contributes to a robust supply of used vehicles. Despite that, strict emissions protocols and the widespread adoption of public transportation in metropolitan areas can affect overall market dynamics. Buyers in this region exhibit a tendency to prioritize all-weather performance and reliability when buying used vehicles.

The Midwest regional market for used cars is steered by a combination of urban and rural demand, with an intensified preference for fuel-efficient and durable vehicles that can endure varying weather conditions and long commutes. The manufacturing and agricultural industries contribute to a stable demand for utility vehicles and trucks. In addition, the region's central location aids the resilient distribution network, facilitating a steady supply of used vehicles. Practicality and affordability are other chief factors shaping consumer preferences in this market.

The South regional market for used cars in the United States profits from an amplifying population and an increased rate of vehicle ownership. The region's mild climatic conditions lower wear and tear on vehicles, leading to a stable supply of well-serviced used cars. In addition, the increasing popularity of large vehicles, such as SUVs and trucks, is a significant trend, boosted by the region's rural areas and expansive geography. Economic growth and heightening disposable income further propel demand in this evolving market.

The West regional market for used cars is multifaceted, with robust demand in both rural and urban areas. The region's emphasis on environmental sustainability impacts an escalating interest in electric and hybrid vehicles, especially in states like California. According to the California Energy Commission, a total of 105,000 public and shared private electric vehicle chargers have been installed across California, in addition to over 500,000 at-home chargers. The state has also recently approved a $1.9 billion plan to further expand and enhance its charging infrastructure. Moreover, the market is steered by elevated vehicle turnover due to the economically advantaged customer base and tech-driven economy. However, strict emissions norms and increased vehicle prices can affect affordability. The region remains a crucial market for technological innovation in the used car sector.

Competitive Landscape:

• The market research report has also provided a comprehensive analysis of the competitive landscape in the market. Competitive analysis such as market structure, key player positioning, top winning strategies, competitive dashboard, and company evaluation quadrant has been covered in the report. Also, detailed profiles of all major companies have been provided. 
• The competitive landscape is represented by the domination of large-scale retailers which utilize widespread inventories, resilient e-commerce platforms, and nationwide access to maintain their leadership. The United States used car market recent opportunities, such as heightened demand for hybrid and electric vehicles, are intensifying competition, compelling major companies to capitalize on these opportunities to expand and innovate their offerings. Additionally, strategic partnerships and the increasing foothold of digital marketplaces are further driving competition and innovation across the country. For instance, in January 2023, CarMax, one of the biggest US-based used car wholesalers, announced a partnership with UVeye to deploy UVeye’s automated inspection technology for wholesale auctions. This technology leverages machine learning, AI, high speed cameras, and sensor-fusion to detect damages in used cars.

United States Used Car Market News:

• In January 2023, AutoNation, one of the most prominent used and new cars retailers in the United States, announced the completion of their acquisition of RepairSmith, US-based full-service mobile solution for automotive repair and maintenance. RepairSmith will act as a resource for reconditioning and internal services, enhancing AutoNation's efficiency in achieving frontline readiness and accelerating vehicle delivery to customers.
• In July 2024, Carvana, one of the fastest-growing online used car retailer in the United States, launched new features, including an integrated federal tax credit that will apply the Clean Vehicle Tax Credit to the purchase of plug-in hybrid or electric vehicles, and automated system that inspects vehicle eligibility for the tax credit. It will further benefit the customers from up to USD 4000 in savings immediately.

United States Used Car Market Report Scope:

Key Questions Answered in This Report:

• How has the United States used car market performed so far, and how will it perform in the coming years?
• What has been the impact of COVID-19 on the United States used car market?
• What is the breakup of the United States used car market on the basis of vehicle type?
• What is the breakup of the United States used car market on the basis of vendor type?
• What is the breakup of the United States used car market on the basis of fuel type?
• What is the breakup of the United States used car market on the basis of sales channel?
• What are the various stages in the value chain of the United States used car market?
• What are the key driving factors and challenges in the United States used car market?
• What is the structure of the United States used car market, and who are the key players?
• What is the degree of competition in the United States used car market?

Key Benefits for Stakeholders:

• IMARC’s industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the United States used car market from 2018-2032.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the United States used car market.
• Porter's five forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the United States used car industry and its attractiveness.
• The competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.