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Latest Dealer Confidence Index edges up

September 22, 2017
Dealers say the auto market is strong and they expect it to remain so in the near term, but their profitability is constrained by market conditions and competition, according to the latest Cox Automotive Dealer Sentiment Index, released Sept. 18.
The Sentiment Index, which is the equivalent of a consumer confidence index, shows how U.S. dealers feel about the current automotive market and prospects for the next 90 days. It also identifies which factors are most significant in driving dealers’ optimism or pessimism, as well as variations by region. 
Current overall sentiment scored 45 in the third quarter, which means that more dealers felt that market conditions were currently weak relative to those who felt that market conditions were strong. 
Pricing pressure, increasing costs of doing business, declining profits, slow customer traffic and a lack of inventory, especially for independent dealers, are the factors that drive dealers to be less positive about the current market. 
Dealers were more positive about the coming three months. The index score of 52 indicates more dealers expected conditions to be strong in the future, compared to those who think conditions will be weak. 
The Q3 results were based on 1,033 online dealer respondents from July 31 to August 7, 2017. The Q2 data for reference was collected April 24 to May 1. The Cox Automotive Dealer Sentiment Index is a new examination by Cox Automotive; this is the first published report. The next issue of the quarterly report will be released in December.
Dealer responses were weighted by dealership type and volume of sales to be representative of the national dealer population.