It’s been a long, arduous political season in the United States, and it’s taken its toll on many of us. In some instances this toll has been emotional, but in other ways it has been financial. Consider this: In the waning months of the election cycle, car sales have begun to decline, somewhat significantly. The question is, will they bounce back once a winner is declared on November 8? Get My Auto has some internal research that should help to answer this question—but first, a little bit of context is in order.
Declining Auto Sales
According to a recent article from Forbes, many car companies are facing enormous strain in the final weeks of the campaign season. “Car sales dropped for the third month in a row in October, with the major players, including General Motors, Fiat Chrysler, Honda, Nissan, and Toyota reporting losses,” the article states.
There are many reasons why this could be the case, including the huge volume dealerships saw a year ago as well as the adverse conditions of Hurricane Matthew. Still, the impact of the election is undeniable, and cannot be ignored.
“According to Dealer.com, which operates websites for more than 60 percent of franchised car dealerships in the U.S., car-shopping behavior in so-called battleground states – quantified via pageviews on its dealer sites – was down by 9 percent last month compared to the same period in 2015,” the article explains.
As for why the election cycle would lead to a decline in auto sales—and in battleground states, in particular—there are a couple of theories. One is that dealerships have simply not had as many advertising opportunities, as online and radio ad rates have skyrocketed in these politically contested states.
Another big factor, however, is the fatigue and anxiety that many consumers face: Simply put, it’s hard to know what the world—or the economy—will look like in the days and weeks to come, and drivers of all political stripes are adopting a wait-and-see approach before they venture into any significant new purchases.
What Happens Next?
There is a silver lining here, though. According to internal research conducted by Get My Auto, we believe that things should start to pick up for the auto industry after the election is over. With the campaign’s anxieties and uncertainties cleared up, we think many consumers will feel more comfortable venturing to the showroom to purchase a new vehicle.
This is happy news for new car dealerships, but it may be even better news for used dealerships. The reason for this is simple: Used cars still represent the best overall consumer value, the maximum bang for buck… and while consumers will soon regain some of their confidence, they’re still going to be looking for a safe investment. That’s what used car dealerships provide.
All of this is simply to say that the last few months have been tough for a lot of us, and not least for dealerships—but it is our finding that consumer behavior will rebound, and soon.