The Australian Automotive Dealer Association has asked its members to come forward about factors hindering their businesses.
The Cox Automotive Australia Dealer Sentiment Index survey has heard from 92 private and publicly-listed dealerships across Australia and published its first six-monthly report.
The online survey has found below average customer traffic, margin compression and rising expenses are the primary concerns of Australia’s franchised dealers.
Rising expenses and swelling inventory levels have been cited as “major concerns”, the AADA reveals.
Rating customer traffic for the first half of 2018, 46% scored ‘weak’, while 53% gave the same verdict for profits over the same six months.
At the same time, 61% rated ‘more’ pressure felt to lower prices, and 60% said securing credit to operate the business was ‘typical’.
The cost of running dealerships is ‘growing’ according to the 62% vote.
Other mid-range concerns for dealers include OEM restrictions and mandates (especially for multiple-franchised dealers), competition, regulations, excessive inventory and vehicle affordability affected by tax, tariffs and stamp duty.
Lower priority concerns include staff turnover, consumer pricing transparency, dealer systems, interest rates and limited variety in inventory particularly among single-franchise dealers.
AADA chief executive David Blackhall says members are reporting tough situations.
“Profits are lower, and customer traffic to dealerships is below average,” he summarises.
“However, they expect conditions to improve somewhat during this second half of the year.”
Blackhall says the first of the biannual surveys will keep a fresh perspective on issues facing the dealer network.
“We look forward to being able to both analyse and report on significant trends within the automotive dealership industry,” he adds.
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