Is now the time to buy or sell a used car? As new sales dip, what to know

This was the first time since February that Canada saw sales at new car dealerships decline, Statistics Canada said, as new car sales dropped 4.6 per cent in May.

Canadians are buying fewer new cars as the economic pressure from U.S. President Donald Trump’s tariffs mounts. It may leave consumers wondering: should they try their luck on the used car market?

Consumers in Canada spent less money in May, with retail sales in Canada falling 1.1 per cent in May to $69.2 billion, Statistics Canada said.

Canada’s auto industry seems to have taken the brunt of falling retail sales, with motor vehicles and parts dealers recording a drop of 3.6 per cent in retail sales in May.

The integrated nature of the North American auto supply chain means tariffs also hit car prices.

“We heard stories about people going running out to the dealer to buy a car or a part for their car before those tariffs started to kick in. We really started to see that in April. So we did expect a pullback (in auto sales) as those tariffs actually came into play starting in May,” BMO economist Shelly Kaushik said.

Specifically, new car dealerships saw sales fall by 4.6 per cent. This was the first time since February that Canada saw sales at new car dealerships decline, Statistics Canada said.

But as new car sales plummeted, some used car platforms and dealerships say they saw sales go up.

“We saw a massive spike in May. We saw — I think this was true for both of ourselves and for dealerships — significant demand for (used) cars in May,” said Dan Park, CEO of used car e-commerce platform Clutch.