Cox survey shows dealers describe current quarter with pessimism

The existing market index fell to 44, a significant drop from 51 in the third quarter.
The existing market index fell to 44, a significant drop from 51 in the third quarter. | File image

Cox Automotive Dealer Sentiment Index data released Dec. 10 shows U.S. auto dealers lean towards describing the fourth-quarter market from a pessimistic standpoint. 

The existing market index fell to 44, a significant drop from 51 in the third quarter.

"The fourth quarter represented a notable negative turn in overall dealer sentiment and their outlook for the future," Cox Automotive Chief Economist Jonathan Smoke said. "The big negative swing in expectations that was significantly lower than last quarter and the same time last year is especially alarming."

The drop in the fourth quarter indicates an undesirable close for the year for dealer sentiment; a very different outlook compared to how optimistic dealers were in the first quarter, despite of the U.S. auto market’s weak start of the year.

"Slowing customer traffic, growing pressure to reduce prices, and declining profitability aligned with a view of the market that retreated from strong to weak in the aggregate index," Smoke said. "Dealers remain worried about the negative impact of proposed tariffs leading to higher prices, but they are also now seeing a less robust used-vehicle market, which is also notably weaker than last year."

A full report on Cox Automotive Dealer Sentiment Index – Fourth Quarter 2018 can be downloaded from this link.

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