Trend Suggests Kerry Win, Stronger '05 Sales

In a not totally scientifically researched Ward's analysis, the pattern of U.S. vehicle sales over the last four-plus decades predicts Democratic Sen. John Kerry will be the next U.S. president and vehicle sales will increase in 2005.

Going back to 1960, sales have tended to be stronger in election years than most others. Changes in volume from the previous year have averaged 2.5% annually for all the years from 1960 through 2003, while election years have averaged a more robust 6.3%.

In fact, beginning with the 1960 presidential race, sales have declined from the prior year in only one of the 11 election years. That was in 1980 when Democrat Jimmy Carter was upset in his re-election bid by Republican Ronald Reagan.

Sales are expected to rise close to 2% this year from 2003, although, including an estimate for August, they are up only 1% through the first eight months. The 2% is not far off from the 2.3% increase of the last election year in 2000 and the 2.2% rise in the prior election year of 1996. (As is true of the overall sales pattern since the 1950s, year-to-year changes in election years have gradually been evening out to lower average gains. In the seven election years from 1960-84, sales averaged 8.1% increases. Since then it has been 4.3%.)

But a sales increase this year does not necessarily shine a favorable light on President George W. Bush's re-election chances. Sales declined in each of his first three years in office, for an average downturn of 1.6%.

Of all the 4-year terms during the survey period, only two have averaged sales declines during the first three years. Both were during Republican administrations, both had presidents up for re-election and both times incumbents lost (Gerald Ford in 1976 and George H. Bush in 1992).

Democratic victories also historically have translated into good light-vehicle sales in the ensuing years.

Not only do vehicle sales tend to run higher in years Democrats are elected president, 7.7% vs.5.2% for Republicans, Democratic presidents also average 5.3% gains in the first year they're in office, compared with a meager 0.5% for Republicans.

Since an 8.6% decline in the first year of the Kennedy Admin., sales have increased four straight times in the first year of a Democrat's 4-year term, for an 80% success rate. For Republicans it's three of six (50%).

Better still, sales during all the 20 years Democrats have held office in the period of 1961 through 2003 have increased an average 3.5%, compared with 1.6% for the Republicans.

Ward's isn't suggesting vehicle sales are a serious tool for predicting presidential elections or forecasting auto sales. But as the current occupant of the White House might say, a “trend is a trend.”