Dealers in the United States are experiencing renewed optimism for the future, a recent survey shows. The Q4 2024 Cox Automotive Dealer Sentiment Index (CADSI) was conducted immediately after the national election in early November.
“The recent resolution of political uncertainty following the presidential election has cleared the path for a more optimistic outlook on future auto market conditions,” said Jonathan Smoke, Chief Economist at Cox Automotive, in a statement. “Coupled with the potential for supportive measures such as tax rebates and the possibility of lower interest rates, dealers are feeling more hopeful about the road ahead as we move into 2025.”
In its update, Cox Automotive said the outlook index that measures dealers’ expectations for the auto retail market in the coming quarter rose to 54 in the fourth quarter of the year, from 42 in the third quarter. They described the increase as significant, suggesting that more dealers believe the market will be stronger in the next three months.
In comparison, a year earlier the index sat at 41 — among the lowest readings in its history. Therefore the third quarter index of 42 was quite low and also well below pre-pandemic norms, highlighting that most dealers saw the current market as weak at the time.
“We saw a surge in the outlook, technically the largest surge we have had quarterly in the history of the data, and it gets us back to Q2 2022 levels,” said Smoke in a statement. “It is the best fourth quarter since 2021, which was the most profitable quarter in dealer history.”
However, views of the overall U.S. economy were mostly flat in the last quarter of the year, with the index at 41. Cox Automotive also said U.S. automobile dealers still see the economy as weak, which has been consistent for the past two years thanks to high inflation and auto loan rates.
