Seasonal market trends create predictable patterns that directly affect trade-in values throughout the year. Understanding these cycles helps dealers maximize acquisition opportunities while avoiding costly mistakes during slower periods. Here's what drives trade-in values during key seasonal shifts and how to leverage these patterns for your dealership.
Tax Refund Season: Peak Trade-In Volume
Tax refund season, running from March through April, consistently delivers the strongest trade-in market conditions. With the average individual tax refund surpassing $3,000 per filer, customers suddenly have down payment money available for vehicle purchases.1
Used-vehicle sales in the period were up more than 5% year over year, in line with tax refund season2. This surge in demand means dealers can be more selective with trade-in criteria while still offering competitive values. Many car shoppers have a little extra cash on hand during this time of year. Naturally, auto sales tend to increase in March and April.3
The increased foot traffic creates opportunities to acquire vehicles from customers who might not trade otherwise. During this period, customers are typically less price-sensitive about their trade-in values because they're focused on upgrading to newer vehicles.
New Model Release Cycles and Inventory Strategy
The automotive model year calendar creates predictable waves in trade-in values. When manufacturers roll out new models in late summer and early fall, previous model years see immediate depreciation, but this creates acquisition opportunities for prepared dealers.
2025 is expected to bring back some normalcy in terms of market seasonality, which means traditional pre-pandemic trading patterns are returning. Smart dealers anticipate these releases and adjust their appraisal strategies accordingly.
The key is understanding which manufacturers are releasing significant updates versus minor refreshes. A complete redesign impacts trade-in values differently than a simple facelift. This helps dealers make better appraisal decisions and avoid vehicles that will depreciate rapidly or sit on lots.
Weather-Driven Demand Patterns
Weather patterns create some of the most predictable seasonal shifts in vehicle demand. Consumer preferences shift throughout the year, affecting demand and prices. For instance, demand for 4WD vehicles increases in winter, while convertibles are more popular in summer. These shifts can influence prices, with vehicles in high demand often costing more.
SUV and truck trade-in values typically peak during October through February as customers prepare for winter weather conditions. Meanwhile, convertibles and sports cars hit their value floor during these same months, making them excellent acquisition opportunities for dealers with storage space.
Current Market Realities
Recent market conditions demonstrate how external factors can amplify or disrupt traditional seasonal patterns. Prices of 3-year-old used vehicles increased by 3.3% year over year to $29,710 on average in Q4 2024, up from $28,7724. These increases reflect ongoing market pressures beyond typical seasonal factors.
After years of growth, new car sales have leveled off. In the second quarter of 2024, sales were up just 0.1% from the previous year. 5 This stagnation affects the entire acquisition ecosystem. When new car sales slow, trade-in volume typically drops, making each acquisition more valuable but also more competitive.
Economic uncertainty, interest rate changes, tariffs and supply chain disruptions can override seasonal patterns entirely. Successful dealers stay flexible and focus on current market indicators rather than relying solely on historical seasonal trends.
Streamline Your Trade-In Process with ClearCar
At ClearCar, our appraisal tool allows customers or your team to take exterior photos of trade-in vehicles using their phone. The images are then scanned by our AI tool to help identify exterior damage including rust spots, dents, and other damages. The photos are tagged, calling out areas where there are problems that need closer inspection.
ClearCar's platform leverages market data to provide accurate valuations that are up to date. Our tool makes the trade-in process more efficient during high-volume seasonal periods. Learn more about ClearCar today.
Sources
- "Retailers’ Tax Season Guide: Navigating IRS Uncertainty While Driving Sales." Total Retail, 7 Apr. 2025, www.mytotalretail.com/article/retailers-tax-season-guide-navigating-irs-uncertainty-while-driving-sales/. Accessed 24 Sept. 2025.
- "Used-Vehicle Inventory Increases As Tax Season Revs Up." Cox Automotive, 14 Feb. 2025, www.coxautoinc.com/insights-hub/used-vehicle-inventory-january-2025/. Accessed 24 Sept. 2025.
- "Pricing Pressure Mounts As Sales Set to Soften in Second Half of 2025." Cars.Com, 18 Jul. 2025, www.cars.com/articles/pricing-pressure-mounts-as-sales-set-to-soften-in-second-half-of-2025-512875/. Accessed 24 Sept. 2025.
- "A Used Car Inventory Crunch Means High Prices Won't Budge for Shoppers in 2025." Edmunds, 26 Feb. 2025, www.edmunds.com/car-news/used-car-prices-2025.html. Accessed 24 Sept. 2025.
- "Predictions For 2025: Automakers Buckle Under Pressure From Consumers." Edmunds, 3 Mar. 2025, caredge.com/guides/car-price-predictions-for-2025. Accessed 24 Sept. 2025.
