U.S. Dealers Remain Optimistic Despite External Threats
Concerns over the economy and political climate failed to discourage franchised and independent retailers surveyed for Cox Automotive’s latest Dealer Sentiment Index.

Fifty-nine percent of franchised dealers and 30% of independent dealers surveyed by Cox Automotive believe import tariffs will have a negative effect on their businesses.
Photo by Julius Silver via Pixabay
ATLANTA — According to the Q4 2019 Cox Automotive Dealer Sentiment Index, U.S. automobile dealers continue to view the current market as negative, with an index score of 47. The slight decrease from Q3’s current market index of 48 was not statistically significant.
The index reading of 47 indicates that slightly more dealers feel that the current market is weak compared to the number who feel the current market is strong.
Read: Cox: Franchised, Independent Dealers See Two Different Markets
As the CADSI has consistently demonstrated, the current market sentiment skews more positive for franchised auto dealers, operations that sell both new and used vehicles, compared to independent dealers, those who focus only on used-vehicle sales, analysts noted.
The gap narrowed this quarter, however, as franchised dealers became less positive — decreasing from 56 in Q3 to 51 in Q4 — while independent dealers remained negative at 46, unchanged from Q3.
“The fourth quarter seems to be revealing an important turning point for dealer sentiment especially compared to this time last year when views of the future dimmed,” said Cox Automotive Chief Economist Jonathan Smoke. “Independents are more optimistic about the next 90 days, and that improvement is related to increasing used-vehicle inventory. Franchises have similar positive views of the future as they did at the end 2018. However, dealers remain concerned about the economy as well as the usual seasonal decline that impacts parts of the country more severely than others.”
When asked about factors holding back the business, dealers in aggregate remained fairly consistent in Q4, although “economy” entered the top five and pushed “expenses” to the sixth spot.
When it comes to views of the future, franchised and independent dealers moved closer together in Q4. Franchised dealers’ sentiment scored 54, down from 57 in Q3, while independents’ sentiment increased from 49 to 51, an improvement that is likely driven by to growing used-vehicle inventory as well as increasing profits.
The overall future index score of 51 in Q4 is better than last year and equal to Q3, signaling a better end to 2019 and sustainable opportunities expected in the used-vehicle market, according to Smoke.
When asked about factors holding back the business, dealers in aggregate remained fairly consistent in Q4, although “economy” entered the top five and pushed “expenses” to the sixth spot. “Market conditions” remained in the top spot as the most cited negative factor for both groups. “Competition” stayed in second place for both as well.
Originally posted on Auto Dealer Today
More Industry

Penske Auto Group Deal a Record
The deal to take the dealership and transportation services company private sets a new pace for industry buy-sell transactions.
Read More →
War Toll a Damper on Used Auto Prices
Cox Automotive found wholesale depreciation to be elevated in September amid high fuel prices and this year's unusual hurricane season.
Read More →
Bridge the Maintenance Gap
With many drivers missing recommended maintenance, service departments offering transparency and efficiency have a better chance of reaching financially strained consumers.
Read More →
California Store Has New Owner
The longtime dealership in the northern part of the state is known for robust fleet sales and has served the state capital for 115 years.
Read More →
BMW Plant Pursues Cleaner Energy
BMW Group Plant Leipzig has utilized hydrogen to help power its production since 2013, but a new pipeline is planned to take it to another level.
Read More →
Auto Affordability Inches Up
The latest Cox Automotive and Moody’s Analytics index shows a slight increase in new-vehicle affordability despite high prices.
Read More →
Ohio Auto Group Under New Ownership
After 79 years with the Schluter family, Mansfield Auto Group has been acquired by Missouri-based Clement Auto Group.
Read More →
RV Group Expands Carolina Footprint
Blue Compass RV Columbia Northeast is the 13th RV dealership owned by Blue Compass in the Carolinas.
Read More →
Agent Acumen
An Agent Summit panel of people who’ve been supporting auto dealers for years gave both timely and timeless advice for those starting out or mulling the prospect.
Read More →
Missed Maintenance Creates Opportunity
As families get back on the road and into daily school routines, service drives have an opportunity to capture customers who are behind on recommended vehicle maintenance.
Read More →