Critical Shifts:
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Necessity-Driven Market: 52% of tax season shoppers are buying out of necessity rather than desire. These are high-intent buyers who need a reliable vehicle to maintain their daily lives.
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The "Pre-Planned" Buyer: 93% of shoppers using a refund had already decided to buy before they even filed their taxes. They aren't "window shopping"; they are looking for the right deal to pull the trigger.
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The Affordability Gap: While 80% of shoppers want a new vehicle, most expect to spend under $40,000. With average new car prices hitting $50,000, there is a massive opportunity for dealers to pivot these customers to high-quality used inventory.
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Rise of the "Near-New" Category: "Near-new" vehicles (one year old or less) are the primary solution for buyers facing sticker shock. Late-model, low-mileage used cars are the "smart play" for those who want new-car features at a used-car price point.
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Increased Refund Power: The average tax refund is up 8.5% year-over-year. This provides a stronger down-payment cushion, which is critical for offseting higher interest rates.
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Demand for Transparency: Because budgets are tight, shoppers are prioritizing transparent pricing, trusted service histories, and digital tools that provide payment clarity upfront.
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Cox Automotive on April 14 released findings from its 2026 Tax Season Consumer Survey, revealing that necessity is driving the majority of this year’s vehicle buying season.
Against a backdrop of higher vehicle prices and fuel costs, the survey findings help contextualize a market where affordability pressures are shaping how buyers approach vehicle decisions.
Cox’s survey findings reinforce the profile of this year’s tax season shopper:
- Ninety-three percent of shoppers using their refund toward a vehicle had already planned to buy before filing taxes
- More than half (52%) cite necessity as the primary motivation.
- Although 80% prefer to buy new vehicles, affordability constraints remain significant. Shoppers said they expect to spend less than $40,000 – well below the $50,000 average new car price – setting up potential sticker shock as market realities set in. Available to Buy Online on Autotrader, inventory from dealers, as well as partners like Hertz Car Sales are helping bridge the affordability gap consumers face by expanding access to ‘near-new’ vehicles: an emerging category of cars that are typically a year old or less. Through its on lot inventory and Rent2Buy vehicles sourced from its expansive rental fleet, Hertz Car Sales offers a large selection of ‘near new’ vehicles – model year 2025 vehicles – in the used retail market. With pricing informed by Kelley Blue Book insights, Hertz Car Sales offers single-owner, well-maintained and regularly serviced vehicles that provide a compelling alternative to buying new.
“Tax season has always brought high-intent shoppers into the market, but this year their motivations look very different,” said Erin Lomax, Vice President, Operations Consumer Marketplace at Cox Automotive. “Consumers are navigating real financial constraints, and they’re looking for dependable, high value vehicles that fit real budgets. Our latest survey reinforces the importance of transparency and affordability for automotive retail.”
Affordability pressures remain top of mind. Early IRS filing season data shows the average tax refund is up 8.5% year-over-year. Yet consumers surveyed still report modest expectations, intensifying affordability concerns for in-market shoppers. Elevated new-vehicle prices, rising gas costs and interest rates continue to influence decision making, leading buyers to seek transparent pricing, predictability and trusted service histories.
“What we’re seeing at Hertz Car Sales this tax season is a buyer who knows exactly what they want: maximum vehicle for their money,” said Chris Berg, Executive Vice President of Global Fleet Management at Hertz. “Near-new inventory, vehicles a year old or less with low mileage, is proving to be the smart play in today’s market.”
As affordability pressures continue, Cox Automotive encourages its industry partners to emphasize transparent pricing, digital retailing tools, and dependable late model inventory aligned with today’s necessity driven buyer. Digital retailing and financing tools that offer upfront clarity will be essential differentiators for dealerships serving shoppers who expect higher interest rates this season.
