The latest AutoTrader Price Index shows the Canadian automotive market has proven resilient and is continuing to stabilize following several years of unprecedented volatility. After a strong first half of 2025 driven by a tariff-related surge in purchasing activity, we expected market activity to moderate in 2026. While the market did slightly shift, the softening was more modest than anticipated, with both new and used vehicle markets proving more resilient than expected.

Although prices have improved since the same time last year, both new and used vehicle prices remain well above pre-pandemic levels, signaling ongoing affordability challenges. With improved inventory levels, we expect market activity to strengthen in the second half of the year, provided broader economic conditions remain stable.

Ultimately, improving inventory, stabilizing pricing, and resilient consumer demand suggest the Canadian automotive market is continuing its transition toward a more balanced and sustainable environment. Provided broader economic conditions remain stable, current conditions suggest a gradual transition toward a more balanced and sustainable market rather than a sharp correction.