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Gore and Bush Tax Plans Would Boost Auto Sales

2 November 2000

CNW Marketing Research: Gore and Bush Tax Plans Would Boost Auto Sales

    BANDON, Ore., Nov. 1 The auto industry would benefit from
measurable sales gains if either George W. Bush or Al Gore win the presidency
and a willing congress enacts either of their tax plans. But the competing
tax-reduction programs have significantly different impact.
    According to CNW Marketing Research's annual Money Trak national study, if
George W. Bush wins the presidency and congress enacts his tax-rate reduction
proposal, the auto industry would reap about 530,000 addition unit sales worth
more than $12.5 billion. Under Vice President Al Gore's targeted tax cuts, the
industry would see sales increase 150,000 units and $3.5 billion.

                Bush       No Tax     Bush Tax     Bush Tax    Bush Plan's
                Sales     Rate Cut    Rate Cut    (millions)     Added
               Increase  (millions)  (millions)  Added Units  Dollar Volume
    New auto
     sales       3.1%       17.1        17.63        0.53  $12,455,000,000

                 Gore      No Tax     Gore Tax     Gore Tax   Gore Plan's
                Sales     Rate Cut    Rate Cut    (millions)     Added
               Increase  (millions)  (millions)  Added Units  Dollar Volume
    New auto
     sales       0.9%       17.1        17.25        0.15   $3,525,000,000

    CNW conducts its twice-a-year study of adult Americans to measure their
product-purchase intentions. The total sample base is 47,000-plus and results
in a highly regarded annual "Wish List" of purchase plans.
    By correlating the product-purchase intentions against sample-respondents'
income, adjusting spending patterns to reflect additional adult disposable
income levels after the tax cuts and performing other economic analysis, CNW
was able to determine if the auto and other industries would benefit from the
presidential candidates' tax plans.
    Other industries that would see increased consumer purchases from the Bush
and Gore tax plans include housing (up 1.6 percent under Bush's plan, 0.8
percent under Gore's plan), the stock market (8.3 percent and 2.4 percent
respectively), foreign travel (2.9 percent and 1.3 percent), home electronics
(6.3 percent and 2.4 percent), savings (1.2 percent and 1.3 percent), used
cars (2.1 percent and 5.6 percent). Note, all increases are in addition to the
Wish List's anticipated 2001 levels.
    The results of a similar 1996 study showed Presidential candidate Bob
Dole's proposed tax cut would have gone to paying existing bills rather than
purchasing new products or services.