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Monday, 14 June 2021 18:20

U.S. Automobile Dealers Experience Unique Mix of Record Highs and Record Lows in the Second Quarter

Index

...equal to Q3 2020. Tight inventory was ranked as the top factor holding back business in Q2, and, when asked, 53% of dealers noted that Finding/Buying Inventory was their top priority in the quarter.

 

Unlike inventory, customer traffic showed significant improvement in Q2, with the index increasing 28 points from the prior quarter and reaching a record-high 57. This reading indicates more dealers feel their customer traffic is strong than feel it is weak, likely due to pent-up demand.

 

Despite tight inventory, vehicle sales have been healthy and profitable in 2021. The Q2 new-vehicle sales index of 65 was a record for Q2 and near the all-time high of 66 set in Q4 2020.

 

The used-vehicle sales index in Q2 reached 62, an all-time record high and the first time the overall used-vehicle sales index moved above 60.

 

Franchised dealers are more positive about current used-vehicle sales than independent dealers, although, with an index score of 55, independent dealers have never been more positive about current sales.

 

Top Factors Holding Back Business Shift in Q2

 

The top five factors holding back business shifted notably in Q2 from Q1, with Limited Inventory jumping to the top spot, with 64% of dealers citing it.

 

Market Conditions rose to No. 2 at 34%. Business Impacts from COVID-19, meanwhile, fell to the No. 3 spot from No. 1. The Economy moved down to No. 4 while Expenses rose from No. 7 to No. 5, with 19% of dealers citing it as a factor holding back business.

 

Notably, Political Climate fell to No. 6 from No. 5 in top factors list, a level equal to Q2 2020. Political Climate as a factor holding back business peaked at No. 3 in Q4 2020. 

 

Source: Cox Automotive

 

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