Franchised dealers generally remain optimistic about the U.S. auto market in the third quarter, even as their outlook on new-vehicle inventory hovered at its lowest-ever levels on Cox Automotive's quarterly Dealer Sentiment Index survey.
Dealer optimism cooled slightly in Cox's third-quarter poll, fielded in July and August, after reaching record highs in the previous quarter. But the outlook about the market is rosier than in the third quarter of 2020, when the economy started to rebound from the coronavirus pandemic and associated shutdowns of dealership showrooms and vehicle assembly plants. Dealers' outlook for the next three months is strong and an improvement from their forward-looking view recorded in the year-ago quarter.
The positive perspective was buoyed by record-setting views on dealership profitability in the third quarter. Yet inventory constraints stemming from the dual crises of the pandemic and a global microchip shortage are weighing on dealers' minds. Franchised dealers' perceptions of new-vehicle supply levels and inventory mix both were at record lows on the survey.