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Customer LoginsCoastal states lead automotive recovery
The 15 largest states (based on new vehicle registrations) account for 70% of all retail new vehicle registrations in the country. Of these 15 states, eight enjoyed an improvement in retail registrations in 2010 (when compared to 2009) that exceeded the national rise of 8.1%, while seven lagged behind the nation. The eight strong performers are, without exception, on the coasts; the seven under-performers, with the exception of Maryland, are all inland (Pennsylvania, a laggard, is hard to categorize geographically because of its width - the western part could be considered in the midwest while the eastern section is close to the Atlantic coast). The three states with the lowest improvement rates (Illinois, Indiana and Michigan) are all in the industrial Midwest; these three also have strong ties to the auto industry, as many suppliers and OEMs are based here.
These state-by-state results suggest a self-fulfilling prophecy for the Midwest: the recovery in new vehicle registrations in this section is inhibited by the poor economy, but the poor economy is at least partially due to the depression in the auto industry. The positive side of this theory might also hold: as the auto industry recovers, these states' economies will grow, which in turn will propel new vehicle registrations even further.
Posted by Tom Libby, PolkInsight Advisor, Polk (03.10.2011)