Cox Automotive analysts say U.S. dealers remain confident in the market despite slowing profitability and traffic, expressing “cautious optimism” thanks to strong sales and low unemployment.

“With sales momentum mostly holding, dealers are not throwing in the towel on sentiment,” writes Cox’s chief economist, Jonathan Smoke, in a release. “New-vehicle sales have come down from the surge in the spring but have remained relatively strong and better than the past few years. While the labor market has softened, unemployment remains historically low and, for the most part, tariffs have only been a glancing blow to consumer wallets so far. While 2025 has been a rollercoaster for many, the market is still generally on track.”

Cox’s quarterly Dealer Sentiment Index gauges franchised and independent dealers’ outlook on numerous facets of their businesses on a 100-point scale. The new report finds overall sentiment among dealers surveyed between July 22 and Aug. 4 essentially flat at 43, up by one point from the prior quarter.

Dealers soured on profitability (down to 38 from 39 in Q2) and customer traffic (down to 33 from 37) but shared an increasingly positive outlook on inventory (up from 50 to 57).

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