Dealers Not Keen on Today’s Auto Market
Despite starting the year with a pessimistic view, the majority of dealers believe the market in the second quarter will be strong.
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Auto dealers started the year the way they ended last year, with a dim view of the market, according to the latest Cox Automotive Dealer Sentiment Index.
Results changed little from the fourth quarter, posting an index of 43, which reflects that dealers consider today’s auto market to be weak, Cox said. The index was down by 14 points year-over-year.
On the bright side, though, the forward-looking index increased dramatically to 52 as dealers look to the second quarter, up from 41 for the fourth-quarter index. That means the majority of dealers believe the market in the upcoming quarter will be strong. That reverses a three-quarter trend of downward market outlook.
“Despite high interest rates and stubborn inflation, the U.S. consumer continues to prop up the economy,” said Cox Automotive Chief Economist Jonathan Smoke. “Auto sales are slow by historical standards, but the sales pace has been improving in early 2023, giving dealers reason to feel somewhat optimistic about the year ahead.”
The rosier second-quarter outlook is still significantly lower than a year earlier, when the index clocked in at 64.