The important thing drivers of sentiment noticed various shifts in Q3. The three-month market outlook index noticed a 3-point lower from the prior quarter, that means the outlook is waning, though, at 60, extra sellers nonetheless see the longer term market as robust than see it as weak. The income index noticed a slight enchancment in comparison with the prior quarter, hitting a document of 60. On the similar time, the worth strain index elevated modestly from Q2’s document low – barely extra sellers at the moment are feeling strain to decrease costs, though that group remains to be within the minority.
“Vendor sentiment has moderated from a document excessive within the spring,” stated Cox Automotive Chief Economist Jonathan Smoke. “Sellers are nonetheless optimistic in regards to the coming months, however the new-vehicle stock state of affairs is just not enhancing, and gross sales are struggling.”
Lack of Stock Impacts Gross sales; Used Stock Improves however Stays in Unfavorable Territory
In line with present market developments, the new-vehicle stock index was unchanged from final quarter’s document low of 13 and down by a notable 16-points in comparison with Q3 2020. Not solely is stock tight, however the combine is poor as properly and getting worse. The brand new-vehicle stock combine index fell to a traditionally low studying of 18 in Q3.
Whereas new-vehicle stock stays challenged, there are indicators used-vehicle inventories are enhancing. The used-vehicle stock index noticed substantial progress from Q2 to Q3, rising by 10 factors to 31. The used-inventory combine index additionally improved, though solely modestly. Each indices stay beneath the edge of fifty and are seen by sellers as declining, not rising.
Tight stock ranges at the moment are negatively impacting gross sales, based on vendor sentiment. The view of new-vehicle gross sales was down considerably from Q2 and in comparison with final yr. The brand new-vehicle gross sales index fell to 51, the second-lowest studying on document. The used-vehicle gross sales index fell as properly, though it stays traditionally excessive at 59, the second-best studying within the index’s historical past and behind solely the document set final quarter.
Prime Components Holding Again Enterprise Unchanged in Q3
The highest 5 elements holding again the enterprise throughout all sellers had been unchanged in Q3 from Q2, with Restricted Stock within the prime spot with 62% of sellers citing it. Market Situations within the second spot rose to 37% of sellers citing it, whereas Enterprise Impacts from COVID-19 was within the third spot, down from No. 2 in Q3 2020. The Economic system and Bills rounded out the highest 5 elements holding again vendor enterprise this quarter.
Cox Automotive Vendor Sentiment Index Methodology
Information for the Cox Automotive Vendor Sentiment Index is gathered through on-line surveys. The Q2 outcomes had been based mostly on 1,100 vendor respondents, comprising 576 franchised and 524 independents, throughout the nation from July 26 to Aug. 9, 2021. Vendor responses had been weighted by dealership sort and quantity of gross sales to be consultant of the nationwide vendor inhabitants. For every side of the market surveyed, respondents are given an possibility that pertains to robust/rising, common/secure, or weak/lowering, together with a “do not know” opt-out. Indices are calculated by making a imply rating wherein:
- Sturdy/rising solutions are assigned a price of 100.
- Common/secure solutions are assigned a price of fifty.
- Weak/declining picks are assigned a price of 0.
Respondents who choose “do not know” at a specific query are faraway from the associated index calculation. The whole metrics reported have a margin of error of +/- 2.9%.
Obtain the complete outcomes of the Q3 2021 Cox Automotive Vendor Sentiment Index.
About Cox Automotive
Cox Automotive Inc. makes shopping for, promoting, proudly owning and utilizing automobiles simpler for everybody. The worldwide firm’s greater than 27,000 group members and household of manufacturers, together with Autotrader®, Vendor.com®, Dealertrack®, Dickinson Fleet Companies, Kelley Blue Guide®, Manheim®, NextGear Capital®, VinSolutions®, vAuto® and Xtime®, are obsessed with serving to thousands and thousands of automobile buyers, 40,000 auto vendor purchasers throughout 5 continents and lots of others all through the automotive business thrive for generations to come back. Cox Automotive is a subsidiary of Cox Enterprises Inc., a privately-owned, Atlanta-based firm with annual revenues of almost $20 billion. www.coxautoinc.com
SOURCE Cox Automotive
