The old saying is “As California goes, so goes the nation”. That certainly has been very true for a high percentage of automotive trends, especially the utter dominance of import brands. As a former Californian and a statistics geek, and I pore over relatively obscure reports like “California Auto Outlook”, published quarterly by the California New Car Dealer’s Association. The news for dealers has not been good, in terms of overall new car registrations in CA. For the fourth year in a row, they are down, some 4.5% in 2019, and a total drop of 15% since their peak in 2016. During that time frame, CA’s economy has been on a tear and its population increased by 2%. It’s hardly a stretch to assume that the projected trend for reduced private car ownership in favor of ride-hailing and other mobility offerings has already made an impact in CA.
One car is clearly bucking the trend: the Tesla Model 3 is in a virtual tie with the Camry for #2 best selling new vehicle, and not far behind the top selling Honda Civic.
And no, pickups and SUV/CUVs are not the top sellers in CA. In that regard, the Golden State is either behind, or really far out ahead.
The steady continued decline in CA new vehicle sales since 2016 was a bit of a surprise to me. This is during a period of very strong economic growth (2016: 4.1%; 2017: 6.1%; 2018: 6.3%), faster than all but a few states , and continued population growth. And the San Francisco Bay Area, which has generally led the state in economic growth from high tech, saw the biggest regional drop in new vehicle sale in 2019 (YTD), down 6.2%.
Here’s the best sellers in the main categories. The only
domestic Big Three brand represented is Ford, with its perennial strong F-series. But its sales are merely 11.6% ahead of the Toyota Tacoma, the dominant truck in its class (Compact/Mid Size Pickup).
Here’s the whole chart, with the top five best sellers of each segment( 2019 YTD through 3Q):
The Honda Civic is #1 overall (58,967), followed by the Toyota Camry (48,760) and Tesla Model 3 (48,483), which is outselling the Mercedes C Class almost 4:1, and the BMW 3 Series 6:1. The best selling light truck is the Toyota RAV4 (40,029). Honorable mention goes to the Ford Flex, which was #4 in its category (Large SUV). Yes, it has been popular in CA. (Note: In Large Vans, the Ford Transit is incorrectly labeled as “Transit Connect”)
The chart on the left show which brands are up in 2019 vs 2018, and which are down. The one on the right compares respective brands’ share in CA vs the total US market.
This chart details each brand’s performance, 3Q and YTD. Yellow highlights show a positive result, bucking the overall downward trend of the market.
Although certain passenger cars are still the top sellers, the total light truck segment is the largest one, and increasing, from 54% in 2018 to 58% in 2019. But these state-wide ratios are undoubtedly more exaggerated regionally: the percentage of passenger cars and the relative lack of large pickups on the freeways of the Bay Area and Southern CA is very noticeable. Almost startling, coming from an area where large trucks are so common.
Here’s a more detailed look at the receptive trends: retail cars are down, strongly; retail light trucks down mildly.
Befitting its trend-setter role, EV’s now have a 5.5% market share. That is very significant, especially compared to the 1.8% in the US overall. And that number would be not insignificantly lower if CA were taken out of the US total.
EVs now sell at the same rate as hybrids in CA. Hybrid share had been falling, as EV’s and plug in hybrids were growing, but 2019 saw an uptick in hybrid share. I’m guessing that the RAV4 hybrid may be a major factor in that; it’s already the #1 selling hybrid in the country. And plug-in hybrids’ share will likely take an upturn when the 2021 RAV4 Prime arrives, with its high performance and 39 mile pure-electric range. I can see that being very popular in CA.
The rest of the report is about used vehicle sales, which increased less than 1% so far in 2019.
It’s looking very much like California is already well past Peak Car.