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Why Late January Is a Great Time to Buy a Car
January is the most underrated month of the year for car buying. Cold weather, holiday spending strain, and a perception that December is the end-all for car buying all tend to keep shoppers at home. However, a strategic approach can help you score limited-time deals in January, as market conditions now heavily favor informed buyers. For example, an iSeeCars study shows that the industry-wide average for leftover 2025 model-year inventory is a whopping 21%, making these cars among the most negotiable today.
Leftover 2025 Models Are a Basis for Negotiation Power
Excess vehicle inventory places pressure on dealerships to make room for 2026 models and manage floor planning, which allows for inventory financing. Dealerships ultimately pay off the vehicles they acquire on credit following sales. With cash flow and sales projections requiring a delicate balance, many dealerships need floorplanning. Automaker dealer bonuses for volume targets compound this January sales motivation.
To clear stock, dealerships commonly offer incentives like low-interest financing, steep cash rebates, and lease deals.
High-inventory segments are especially prime for January incentives. These segments commonly include compact and subcompact cars/SUVs, luxury SUVs, electric vehicles, and full-size trucks. Among these segments, unsold 2025 models will remain the most negotiable. As we’ve seen in January, these cars will also be subject to the steepest discounts and financing incentives.
Where exactly can we expect to find the most negotiable cars right now? Here’s a look at the brands with the most remaining 2025 inventory today:
| Brand | Total inventory | Leftover 2025s | % 2025 Inventory |
|---|---|---|---|
| Alfa Romeo | 1,990 | 1,321 | 66% |
| Audi | 36,797 | 22,228 | 60% |
| Maserati | 1,015 | 546 | 54% |
| Mitsubishi | 15,501 | 8,186 | 53% |
| Ford | 489,105 | 231,917 | 47% |
| Jeep | 174,035 | 71,226 | 41% |
| Mazda | 88,902 | 34,146 | 38% |
| Cadillac | 29,277 | 9,254 | 32% |
| Kia | 162,815 | 46,297 | 28% |
| Nissan | 183,849 | 51,538 | 28% |
Data source: CarEdge.com
See unsold 2025 cars and trucks near you
Don’t Count Out Big-Name Brands
Since dealerships need a reason to offer savings, such as leftover inventory, deals for higher-selling brands tend to be less prevalent. However, big-name automakers such as Ford, Mazda, and Nissan still have plenty of leftover 2025 inventory to move.
In late January, nearly half of all Ford inventory is leftover 2025 models. Jeep is close at 41%, followed by Mazda at 38% of inventory. Despite making headlines last year over financial woes, Nissan is doing slightly better with ‘just’ 28% of inventory being leftover 2025 models.
Make the Most of Late January Deals
Despite January representing a prime opportunity for car-buying deals, the best incentives won’t come to you. To attain negotiation leverage, you’ll need to prepare beyond checking a single automaker’s website for incentives. Key steps include researching fair market values with CarEdge, comparing prices and incentives across nearby dealerships, and using CarEdge’s out-the-door pricing calculator before setting foot on a car lot.
Understanding data like out-the-door pricing helps you prioritize the total cost over monthly payments, helping you avoid value traps like hidden fees and longer loan terms.
Similarly, arranging financing before car shopping puts the ball in the dealership’s court to beat your rate or match the car’s price. You’ll need a credit check across multiple lenders for pre-approved financing, but completing this within a 14-day window minimizes credit score impact.
Key Update on Tariff Uncertainty Surrounding European Luxury Cars for January
January is an especially significant buying window for drivers considering European luxury brands, primarily luxury ones, such as:
- BMW
- Mercedes-Benz
- Land Rover
- Volkswagen Group (VW, Audi, Porsche)
With ongoing tariff uncertainty under President Trump surrounding Greenland, European luxury brands may raise prices to offset potentially higher U.S. export costs. However, President Trump stated that he had formed the “framework of a future deal” on Greenland, with new tariffs no longer needed on opposing European nations, according to CNN.
Handle January Car Buying Like a Pro With CarEdge
While the January buying window for attractive limited-time incentives is narrowing, you should avoid rushing into a purchase without preparation. Focusing on 2025 models gives you the best odds of attaining maximum savings, and brands with consistently tight inventories, such as Honda, remain an option.
Simplify your ability to score January deals with CarEdge’s free car buying cheat sheets, which teach negotiation strategies when dealerships won’t budge, dealership industry terms to keep you ahead of the curve, and much more.
Will used car prices fall in 2026? A look at the numbers
From 2021 to 2023, drivers craved lower used-car prices, as a decline in vehicle production and supply shortages from the pandemic triggered volatility. Wholesale used car prices softened in late 2025, suggesting a decrease in retail used prices could be on our doorstep. Still, overall economic uncertainty remains.
So, are used vehicle costs normalizing or entering a new phase? We’ll preview 2026’s wholesale and retail outlook by exploring factors driving trends, where specific segments may land, and actionable advice on buying, selling, and waiting in the 2026 used car market.
Ultimately, used vehicle prices in the US are expected to remain stable to slightly elevated in 2026. SUVs and trucks will likely maintain strong demand, subsequently firming prices with some room for growth, but certain segments, such as used electric vehicles (EVs) and off-lease models, will likely balance the scale.
What’s Driving 2026 Used Car Prices
Interest, inflation, and the flood of new cars into the used inventory are primary macro factors driving used-car prices in 2026.
Interest rates
Regarding interest rates, new-vehicle APRs (annual percentage rates) directly affect used-car financing, as lenders use similar benchmarks across segments. Edmunds reports that in November, the average APR on a new-vehicle loan dropped to 6.6%, the lowest level of 2025.
This downward trend is expected to carry into 2026, helping drivers with monthly payments. Still, good credit is vital for acquiring quality financing terms.
Inflation
Greater inflation contributes to higher used-car prices, as it elevates new-car costs, tightening pre-owned inventory as more buyers shop pre-owned to save. Labor, logistics, and raw material prices will remain expensive for manufacturers in 2026. While inflation is expected to slow somewhat in 2026, tariffs on imported parts and vehicles are keeping costs high for several new and well-maintained used cars.
Off-lease vehicles returning and wholesale price trends
Shoppers will see a meaningful increase in off-lease vehicles returning to the market in 2026, a reversal from years of scarce supply starting in 2022. This increase is attributed to an uptick in leasing rates since 2023 that wasn’t felt in 2025.
Despite Manheim stating that November showed a slight rebound in adjusted used wholesale prices, this followed October’s 2% decline in adjusted wholesale prices. Additionally, wholesale days’ supply rose to 30 days in November and Cox Automotive reports that average used retail prices decreased by only $217 to $25,730 from the start of November to the beginning of December.
Overall, this 4 to 6 week retail lag, combined with balanced wholesale supply and off-lease floods, implies 2026 stabilization with targeted relief.
Segments to watch: winners and losers
Let’s take a closer look at what’s likely to happen with used EV, truck, SUV, and compact pricing, as well as why.
Used EVs: Expect falling prices
Shoppers can expect used EV prices to fall in 2026 following the end of federal EV subsidies. Most buyers rushed to purchase in late 2025, leaving 2026 used EV inventory stagnant on dealership lots. Adding to this buyer’s market is a building oversupply from lease returns. EVs consistently see steeper depreciation than the overall market, and that’s a win for used buyers.
In November, the average sticker price for used EVs declined 2.4% year-over-year and 2.7% month-over-month to $36,440. However, used EVs still sell for a $9,000 premium on average in 2026.
With affordable electric models like the revamped Chevy Bolt and Nissan LEAF on the way this year, we expect further downward price pressure to send the average selling price of a used EV to fall by 5-10% by late 2026.
Used Trucks and SUVs: Tougher negotiation
Wholesale and retail prices for used trucks and SUVs are expected to remain firm in 2026, with room for moderate increases for top models as demand in these segments remains high. Though a 2026 increase in lease returns will include trucks and SUVs, the Federal Reserve’s slight decrease in interest rates by mid-2026 could heighten already strong demand. In fact, used truck and SUV prices may finish the year slightly higher (think 1-5% average increases), especially if inflation persists.
As more drivers shift preferences toward larger vehicles, higher demand makes used SUV and truck pricing less negotiable than other vehicle segments. If you’re planning to buy a used truck or SUV in 2026, be sure to do your homework to find the best deal. Or, you can always have a Concierge negotiate on your behalf.
Used Sedans: Plenty of wiggle room
In contrast to trucks and SUVs, compacts and sedans are showing signs of retail corrections in 2026. Alongside off-lease and rental fleet returns, the higher average depreciation rate of sedans facilitates cheaper dealer auction prices, and in turn, lower sticker prices on the lot. For used car buyers looking for the lowest prices in 2026, sedans are going to be a hotspot.
By year’s end, used sedan prices are likely to fall between 1-5% for the popular 2-5 year-old car market.
Dealer dynamics: auctions to sticker shock
You’ll gain leverage shopping in the 2026 used car market as inventory lingers, so use CarEdge’s Free Car Value Calculator to track real-time depreciation, helping you negotiate money off sticker prices. Those looking to maximize a used sale can also use the tool for optimal results.
Seasonal shifts in 2026 used car prices
Used-car prices often decline after December, as buyers can experience holiday spending fatigue, lowering demand, especially for compacts and EVs. Additionally, individuals may be more motivated to sell and make money after the holidays.
Wholesale used car prices tend to dip somewhat during the summer after vehicle sales increase from the spring tax refund wave. Greater car sales often trigger more trade-ins, increasing wholesale supply and placing downward pressure on pre-owned prices. The Federal Reserve’s slight rate adjustment will likely cause APRs to drop lower, boosting affordability as inflation slows.
Summer wholesale price decreases are more commonly associated with sedans than with trucks and SUVs, and EVs should offer buyers value advantages. Consider shopping in the late summer/fall when lag hits retail.
For sellers, late 2026 is a prime time to move before wholesale auctions decrease values in softening segments. Lessees can benefit from avoiding lease-end buyouts on compacts or EVs to dodge depreciation, while trucks, SUVs, and hybrids typically offer better buyout opportunities.
How CarEdge can help you buy a used car
Whether you’re buying or selling in 2026, timing and information are everything. CarEdge Pro gives you real-time market data, dealer cost insights, and your own AI-powered anonymous negotiator agent. It’s the same toolkit our experts use every day.
For the complete white glove car buying service, CarEdge Concierge takes care of it all. Your personal Concierge will listen to your wants and needs, find the most negotiable cars, and fight for a fair price, all while you sit back and relax. It’s the easiest way to buy a used car in 2026.
The used car market in 2026 rewards the prepared. Let CarEdge give you the edge you need.
