I’m a Political Strategist: Changes That Could Come to Car Prices if the Senate Turns Republican
Car prices skyrocketed during the pandemic, and whether you tried to buy a new or used vehicle during that time, you probably felt the effects of sparse supply and high demand and prices.
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While the vehicle market has cooled off a bit and prices have dropped, the upcoming election could change that. If the Senate turns Republican, we might see several effects on car prices.
Decreased Manufacturer Costs
Kateryna Odarchenko is a political consultant and campaign manager who specializes in elections, public relations, and communications in the USA, EU, Eastern Europe, Ukraine, and Central Asia.
Odarchenko explained that if the Senate turns Republican, we might see reduced vehicle manufacturing costs. “Republicans typically support policies that lower taxes and reduce regulations, which can decrease manufacturing costs for carmakers and potentially lower retail car prices,” she said.
She explains that a Republican Senate might also further deregulate the automotive industry, which could speed up manufacturing processes and further reduce costs for manufacturers.
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Increased Consumer Car Prices
While reduced manufacturing costs could correlate with lower retail costs, Odarchenko noted that it’s possible that a Republican Senate could also raise vehicle prices. “If new tariffs are introduced, or trade policies change, this could increase car prices,” She said. “For example, in 2018, Senator Pat Toomey expressed concerns about tariffs, stating they could raise costs for consumers.”
Reduced Electric Vehicle Discounts
Electric vehicle credits and incentives currently help to make buying an electric vehicle more affordable, but Odarchenko said that a Republican Senate might reassess or reduce those credits and incentives.
“Republicans often emphasize market-driven solutions over government subsidies, which could result in decreased financial support for electric vehicle buyers and potentially slow the growth of the electric vehicle sector,” Odarchenko explained. “For instance, Senator John Barrasso has been vocal about his opposition to electric vehicle subsidies, arguing that the market should determine the success of electric vehicles without government intervention.”
Lower Gas Prices
In addition to affecting vehicle prices, a Republican Senate may impact gas prices. Odarchenko said that it’s likely a Republican Senate would support policies that boost domestic oil and gas production, which could help to lower gas prices.
“Republicans generally advocate for increased drilling and fewer regulations on the energy sector to increase the supply of domestic oil,” she says. “This approach aims to keep gas prices low.” However, she noted that global factors, like geopolitical events and their effect on international oil prices, can also influence gas prices.
Political Changes and Impacts on the Automotive Market
Odarchenko explained that political changes can also have direct and indirect impacts on the automotive market. “Future decisions will depend on specific policy initiatives and legislative actions taken by the new Seate,” she said. Additionally, global economic conditions and technological advancements will continue to shape the automotive industry.”
If you’d like to learn more and explore a comprehensive analysis, Odarchenko suggests reading insights from think tanks like the Brookings Institution, Heritage Foundation, and American Enterprise Institute. These think tanks provide in-depth analyses of policy impacts on different sectors.
Editor’s note on election coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
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