After being asked how they would describe the current used-vehicle sales environment, the view is a bit rosier for franchised dealers than for independent dealers, but overall, the view leans toward positive.

And sentiment is on the upswing for independents.

That’s one finding in the debut edition of the Cox Automotive Sentiment Index, a new quarterly study from the company.

This first edition covers the third quarter and is based on data from an online survey Cox Automotive conducted between July 31 and Aug. 7, which included 1,033 dealer respondents. Second-quarter data – gathered between April 24 and May 1 – is also included in the report.

Cox Automotive weighted dealer responses by dealership type and sales volume to represent the overall dealer body.

The survey touches on a variety of areas of a dealership’s operation, including the used-car operation.

Used-car stats

So, how exactly are dealers feeling about the used-vehicle sales environment?

Showing scale from zero to 100 — where zero is “poor,” 50 is “fair” and 100 is “good” — the score for franchised dealers was 68 in the third quarter, compared to 70 in the second quarter.

For independent dealers, it was at 53, which is up from 50 in Q2.

The overall score was 57.

As for used-car inventory, dealers are seeing some stability.

Asked how they would describe their store’s current used-vehicle inventory levels — zero being “declining,” 50 being “stable” and 100 being “growing” — franchised dealers were at 55 and independents were at 47. The overall score was 49.

Overall takeaways

Dealers, overall, most often identified “market conditions” (37 percent), “limited inventory” (34 percent) and “competition” (31 percent) as the top factors limiting their business.

For franchised dealers, the top three were market conditions (38 percent), competition (36 percent) and expenses (21 percent).

For independents, limited inventory (40 percent) topped the list, followed by market conditions (36 percent) and credit availability for consumers (30 percent).

When dealers were asked they would describe the current market where they operate, the overall sentiment was 45. Franchised dealers were at 55 and independents were at 42.

On that scale zero is “weak,” 50 is “average” and 100 is “strong.”

The overall score of 45 indicates “more dealers felt market conditions were currently weak relative to those who felt market conditions were strong.”

In its key takeaways, Cox Automotive indicated: “Pricing pressure, increasing costs of doing business, declining profits, slow customer traffic and a lack of inventory, especially for independent dealers, are the factors that drive dealers to be less positive about the current market.”

The company added: “Dealers were more positive about the next three months. The index score of 52 indicates more dealers expected conditions to be strong in the future, compared to those who think conditions will be weak.”