From AAIA SmartBrief
Results of the joint Business Confidence Index for June 2013 show that aftermarket business leaders were positive on the economy and more confident in the future of the automotive aftermarket over the next 12 months, according to AAIA and Northwood University.
AAIA members completed the 30th monthly index survey and, according to the data:
* The overall AAIA/Northwood University Automotive Aftermarket Business Confidence Index for June was 18.09, down from the May reading of 20.27 (Chart 1), placing aftermarket leaders in the mid-range of the “slightly more confident” category (see Table 1).
* The overall AAIA/Northwood University Automotive Aftermarket Economic Confidence Index for June was 13.83, up from the May reading of 12.16 (Chart 2) and marking the sixth month the index has been positive since March 2012, thus placing aftermarket business leaders on the low side of “slightly more confident” in the economy for June (see Table 2).
“It is clear aftermarket leaders had slightly less confidence in the industry in June compared to May 2013, yet are generally positive,” said Dr. Timothy Nash, Northwood University. “It is also obvious that business leaders were slightly more confident regarding the overall economy in June. We believe a continued weak European economy, a mixed Chinese economy and a decline in miles driven from a year ago are the primary reasons for generally disappointing yet overall improving confidence among aftermarket leaders in their business and the economy. A 0.13 percent increase in April to May 2013 miles driven gives us some pause for optimism. The historically higher than average gasoline prices give us reason for concern in the economy and aftermarket at this time yet gasoline prices declined again in July 2013. The negative trend with regard to our national debt and that of Europe was worsened by mixed U.S. fundamentals in July and a lower than expected second quarter 2013 U.S. GDP report showing GDP growth of 1.7 percent.
"The most recent miles driven data shows a slight increase in miles driven from April to May 2013 and it also shows a decline in miles driven in May 2012 relative to May 2013. A positive resolution to the ‘sequestration debate’ in Washington, D.C., and ‘debt crisis’ around the globe, and the adoption of a rational and predictable tax policy in the U.S., would help to offset high world oil prices and enhance aftermarket business confidence in the coming months (see Chart 2) ," Nash stated.
The 31st installment of this survey was sent to members on Aug. 10, 2013. Results will be calculated monthly and reported in AAIA SmartBrief. Member responses will be used solely in the aggregate and for the purpose of providing empirical information.
