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Independent Dealers Predict Prosperous 2019

An Equifax/NIADA survey of U.S. independent auto dealers charts growing optimism about the economy and their businesses heading into the new year.

November 7, 2018
Independent Dealers Predict Prosperous 2019

 

2 min to read


Nearly one-third of independent auto dealers surveyed by Equifax said they expect to expand operations in 2019.

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Photo by danisampa via Pixabay

ATLANTA — A third-quarter survey conducted by Equifax in cooperation with the National Independent Auto Dealers Association show a majority of independent auto dealers believe the U.S. economy and their businesses will continue to perform in 2019.

Dealers were asked whether they expect economic conditions to improve, stay the same, or decline over the next quarter. “Improve” was the most popular answer at 47%; only 36% said the same at this time last year. Nearly one-third (32%) said they plan to expand their businesses over the next quarter by adding new equipment or enhancing their structures or property, a slight gain on the 30% who answered the same question in the affirmative last year.

Asked whether they anticipate increased retail sales, 56% said yes (compared with 55% in 2017), 36% predicted sales would be flat (compared with 34%). Only 8% said they expect sales to decrease, even fewer than the 11% who said the same last year.

When asked to cite the factors that could make it difficult to secure loans for used-car buyers, dealers listed tightening credit (40%), reduced access to finance sources (25%), terms that would make it tough to compete with franchised dealers (25%), and enhanced identity and background verification measures (14%).

Equifax analysts said 2018 used-car sales are on pace to match a strong 2017, noting plateauing and declining new-car sales and lease activity. The credit reporting bureau’s deputy chief economist, Gunnar Blix, noted that car buyers overall are financing more — a clear reflection of the continued increase in the price of cars and trucks and the starting impact of rising interest rates.

“We see the shift from new-vehicle sales activity to more used vehicles continuing, largely because the shopper knows the price of autos is going up and they realize they can find bargains on slightly used, off-lease vehicles that are readily available,” he said. “Interest-free loan- and lease-incentives are also becoming few and far between.”

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