The Cox survey gauges dealers' perceptions of the past 90 days and expectations for the next three months and identifies key factors affecting their optimism or pessimism. In the second-quarter survey, respondents' outlook about key metrics that determine dealership success, such as the sales environment and customer traffic, fell to the lowest levels recorded in the index's nearly three-year history.
Respondents to the latest survey numbered 1,140 — 610 franchised dealers and 530 independents. Responses are weighted by dealership type and sales volume and then used to calculate what's known as a diffusion index, in which a number greater than 50 indicates that dealers view conditions as positive.
Overall sentiment about current conditions plunged deeper on the negative side in the latest survey, with a score of 20, down from 49 in both the most recent and year-ago quarters. Franchised dealers rated current conditions at 30, down from 54 a year ago and 55 in 2020's first quarter. Franchised dealers' expectations for the next 90 days, however, scored 57, down from 66 in the previous quarter but still in positive territory.
Sentiment about customer traffic dropped to 20, the lowest score ever recorded from franchised respondents on any topic in the survey.
Used-vehicle sales, often a high point for franchised dealers, fell into negative territory for the first time in the survey's history, to a score of 43. That's compared with 72 for both the most recent and year-ago quarters.
COVID-19 effects overwhelmingly earned the top slot among the factors holding business back in the second quarter, with 72 percent of franchised respondents citing it. The U.S. economy rocketed to second slot, cited by 53 percent. In the first quarter, economic concerns ranked sixth among factors holding business back, with 19 percent citing it.