What to know if you’re buying a car in 2026

Looking to buy a new car? Maybe you're thinking about exploring the used vehicle market?

Canadian shoppers have many choices when it comes to purchasing a car, but it's always important to stay up to date with the changes in the market. 

AutoTrader's Q2 Price Index, which dives deep into market trends and insights, has some key findings that could be of importance. Fresh off the press, here's what it says are the top five things you need to know about the Canadian market

Improving inventory levels

First things first: inventory levels are improving for new and used vehicles.

Following last year’s tariff-driven surge in demand, AutoTrader expected the market to slow down significantly. While demand has moderated, it hasn’t been as pronounced as anticipated — a positive sign for the overall health of both new and used vehicle markets because it means shoppers have more choice.

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Canadians now have more opportunities to compare options, find better pricing, and buy a vehicle that fits their lifestyle and budget.

Car prices decline, but affordability remains a top consideration

While AutoTrader found prices to be easing, affordability continues to be one of the top considerations for Canadian car shoppers.

Autotrader research shows 87 per cent of consumers looking to purchase a vehicle within the next year said value and affordability were the top considerations, and 61 per cent prioritize getting the best value for their money.

The good news is used and new vehicle prices are declining. Consider this: As of June 2026, the average new vehicle price declined 2.2 per cent year-over-year to $63,016. Meanwhile, the average used vehicle price declined 2.6 per cent year-over-year to $36,690.

However, it’s worth remembering that while prices are trending down, they remain elevated compared to pre-pandemic levels. And that's one of the big reasons why affordability remains a challenge.

EV demand surges 

One very interesting finding from AutoTrader's Price Index — EV interest is notable. Renewed incentives, charging infrastructure investments, and high gas prices have only increased demand for EVs. 

There is also growing demand in the used EV market, with prices up 0.4 percent year-over-year.  This is in contrast to the broader used vehicle price trend, where prices are going down.

CUSMA concerns

The Canada-United States-Mexico Agreement (CUSMA), which governs free trade in North America, is raising some concerns with Canadians, but not causing broader market disruption yet, according to AutoTrader.

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While Canadian shoppers are aware of CUSMA concerns and may expect potential price increases, AutoTrader data showed no significant effect so far. 

It is, however, influencing behaviour. Consumers said they are making affordability-focused adjustments like buying sooner, delaying a purchase, or looking at more affordable vehicle options.

Earlier this month, U.S. President Donald Trump declined to extend CUSMA for another 16 years, after a review meeting. At this point in time, trade deals remain active while ongoing negotiations are continuing. The outcome of those discussions could have significant implications for the auto market, with automotive manufacturing and trade rules among the key issues being negotiated.

AutoTrader is monitoring the situation, and consumers can rely on it to examine and explain the impact.

Learn more at AutoTrader 

All in all, it looks like the Canadian automotive market is more stable than you may think.

Vehicle prices are easing, and inventory is improving; there's no doubt that demand remains high. Perhaps not as surprising, affordability continues to be one of the top considerations for Canadian car shoppers.

If you're shopping for vehicles, visit the AutoTrader website. It has a hundreds of thousands of new and used vehicles across the country. Browse thousands of cars, compare prices and get helpful shopping tips.

To learn more about what's happening with car prices and what it means for consumers, visit the AutoTrader website to read the Q2 price index.