Climbing gas prices can’t slow down California’s auto sales

150 150 Justin Ewers

High gas prices couldn’t keep auto sales down in California. (Photo credit: Glenn Batuyong via Flickr)

It has been two straight weeks of hand-wringing across the state about California’s sky-high gas prices—which hit record highs last week with a state average of $4.67 a gallon—sparking cries of energy market manipulation in some quarters and fretting about the state’s restrictive environmental standards in others.

Gov. Jerry Brown took emergency steps to ease the impact of the price spike by allowing the early sale of a less expensive, “winter blend” of gasoline. Many pundits, though, kept up their assault on the state’s energy policies, warning of dire economic consequences. “Californians have no one to blame but themselves,” claimed one political commentator in the magazine Commentary, predicting an economic “collapse” due to the state’s high environmental standards.

As the sound and fury subside, however, a new study released yesterday provides a timely reminder of the sturdiness of the California economy, even in the face of rising gas prices.

According to the California New Car Dealers Association study, Californians purchased 34 percent more new cars through September of this year than they did a year earlier—due to a combination of pent-up demand, easing credit conditions, and improving supplies of Japanese cars. In the first nine months of 2012, Californians bought nearly 1.6 million cars and light trucks, a 26 percent jump over last year, while the rest of the country—where pundits have reminded us for weeks that prices average only $3.69 a gallon—saw only a 14.5 percent increase.

The good news even came with a silver lining. In a nod to the climbing price of gas and the state’s reputation for environmentalism, the top-selling car in California was the Toyota Prius. California drivers registered almost 50,000 new Priuses this year. That single brand alone accounted for more than twice as many sales of full-size SUVs.

These numbers are a reminder of the dual goals of the California Economic Summit—to create both a prosperous economy and a sustainable environment in the Golden State. One of the Summit’s Action Teams is focused exclusively on finding ways to streamline regulations while preserving the state’s environment. Follow the Summit’s progress with these and other action areas on the Summit Progress Tracker.



Justin Ewers

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