Economic Update: Source

The Big 3 have commitments to provide historic improvements in wages and benefits and improvements to EV battery manufacturing. If you are asking, why can’t they meet every demand they claim it is because we need profits to invest in our future.

For now, Retail sales rose 0.7% in September, stronger than expected, extending the 0.8% gain in August

Consumer spending growth was led by strength among motor vehicles and parts dealers (up 1.0%), food services and drinking places (up 0.9%), gasoline stations (up 0.9%), and health and personal care stores up 0.8

 

Wholesale Market Trends: Source

  1. Wholesale used-vehicle prices decreased 1.6% from September in the first 15 days of October. That was also unexpected due to the strike.
  1. The auction channel shows a slightly stronger-than-normal buying demand for this time of year of 54.0%

Service Market Data: Source

  1. Service activity at franchised dealerships in the U.S. declined 10.5% month over month in September/
  2. The Repair Order Volume Index was also lower year over year in September, down 4.3% from September 2022.
  3. The Repair Order Revenue Index for September declined 2.0% MoM.
  4. Year over year, the Repair Order Revenue Index is up 2.8% and up more than 35% from September 2019.

Summary: Source

According to Automotive service activity at franchised dealerships in the U.S. declined month over month to the lowest level since April 2023. The Repair Order Volume Index was also lower down 4.3% from September 2022.

With the UAW strike against parts and distribution warehouses initially, this looks like a decline driven by part shortages, but the decline in ticket volume was consistent across all brands which says it was more than just the strike. Most likely affordability issues that drive service customers to independents. Working to win that market share back with tires and oil change service marketing will help drive deeper absorption.