7/1/2019

Report: U.S. Auto Suppliers Remain Pessimistic

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Worries about trade tariffs and shrinking car sales are keeping about 70% of U.S. auto suppliers in a pessimistic mood about the industry’s future over the next 12 months.

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Worries about trade tariffs and shrinking car sales are keeping about 70% of U.S. auto suppliers in a pessimistic mood about the industry’s future over the next 12 months, the Original Equipment Suppliers Assn. reports.

OESA’s Automotive Supplier Barometer Index, which fell to a 10-year low of 35 in the first quarter, remained at that level in April-June. A score of 50 is neutral.

The rating has been slowly sliding since the beginning of last year, when optimism about U.S. tax reform pushed the index to 57. The measure fell 10 points to 43 in the third quarter last year and 39 in the fourth period.

About 25% of respondents to the current survey say their outlook hasn’t changed through the first half of the year. A slightly greater share describe themselves as “somewhat” more pessimistic. But the proportion who report becoming “significantly” more pessimistic has declined by the same amount.

Mike Jackson, OESA’s executive director of strategy and research, notes that top suppliers are showing greater focus and more flexibility in techniques—including leveraging external partners—to advance their efforts to innovate.