State Car Dealers See 27.4% Surge In Sales

The California new vehicle market recovery continued in the second
quarter of 2012, with new vehicle registrations increasing 27.4
percent versus a year earlier says the California New Car Dealers Association. It was the 13th consecutive quarterly
increase for the market, going back to the fourth quarter of 2009 indicating the state’s economy might be more robust than thought.

The increase for all of this year is now expected to reach nearly
20%, with another increase likely in 2013, as well. Other key trends
in the state market:
• Chrysler was the brand with the largest percentage increase in
the first half of this year, up nearly 200 percent (see graph).
• Korean, Japanese, and Detroit Three brand registrations each
increased by more than 22 percent.
• Passenger car share increased 0.9 of a share point. SUVs were
down 1.4 points.
The 22.6 percent first half improvement in the state market exceeded the 14.8 percent increase in the nation.

The Toyota Prius was the top selling car followed by Honda Civic and Toyota Camry. Honda CRV was the best selling truck followed by Ford F Series.

The Association says California is likely to register 1.54 million vehicles this year compared to 1.29 million in 2011 and 1.17 million in 2010.

Goshen To Get New Tire Store

The Highway 99 community of Goshen will get a new Firestone Tire store with construction starting early next year as the Tulare-based owners  add their 11th location in the Valley. Lionel and Kevin Pires have built a network of tire stores from Delano to Merced and have now filed for a permit to build a 15,000 sf tire sales and service store on 1.77 acres on  the westside of Hwy 99 on the Frontage Rd at Ave 304.

County planner Scott Cochran says the company has to go through a county hearing because of its proximity to the  Visalia airport but” there are no issues with it.”

Currently, Tulare Firestone, Inc. operates 10 facilities and is one of the largest distributors of tires for agricultural equipment in the Western United States. A fleet of 18 service trucks provide services to farming and trucking operations throughout Central California with nearly 100 people.

“We’ve already bought the land” confirms Kevin Pires.

Cochran says although the project is located near the current Ave 304 offramp” these offramps are going away” with plans by CalTrans to widen Hwy 99 (starting this year) and relocating the Betty Drive interchange advertising for construction set for 2016 says CalTrans.

The construction of a rail overpass on Betty Drive/Riggin,complete later this year,is likely to increase truck traffic coming off of Hwy 99 in coming years, perhaps a good reason to set up a tire store nearby.

“People are going to get to Goshen from the Betty Drive interchange” expects Cochran, for now the only bridge that connects both sides of town.
Just how the closure of the Ave 304(Goshen Ave) offramps that connect to a major business street into the the Visalia Industrial Park will be compensated for – is up in the air. “it could be the Goshen Community Plan could call for an overpass on Goshen Ave to connect to both sides of the town and Visalia” suggests Cochran although “residents will have to push for it if they want it.”

“It sure would bring some new economic development to this hard hit community.”

Governor Signs High Speed Rail Bill / Kings Co Weighs Route

Governor Jerry Brown is visiting Los Angeles’ Union Station today signing the bill providing funding for construction of the first phase of a statewide high speed rail service that will connect LA to SF.

The symbolism is clear that the victory on passage in the state Senate recently came because of support in urban areas for the big project sweetened with $8 billion for upgrades to their commuter train system that will connect to the future bullet train.

In the meantime the focus this week is on Kings County where a comment period on a revised EIR has begun. While farmers and government officials have been vocal opponents of the project – it was state Senator Mike Rubio who represents Kings County who cast a deciding vote to support the project.

“The construction of the Central Valley segment will create about 100,000 year-long jobs in the Valley. Unemployment rates in Fresno, Kern, Kings and Tulare Counties are unacceptable and high speed rail guarantees jobs for the Central Valley” said Rubio.

Which alignment will the California High Speed Rail Authority pick through the South Valley to bypass Hanford when they run the bullet train route through Kings County? Originally they posed a route east of Hanford that would cross 198 just east of Hwy 43. Now they have offered a west of Hanford alternative as well,the “revised draft” released this week, crossing 198 west of Armona. The Authority board will select which one after the first of the year with the final Record of Decision on their EIR coming in March 2013.
Then expect the lawsuits to come from Kings County property owners who pretty much don’t like either route. Hanford does not want it to run through their town as Amtrak does today. Tulare County cities prefer the east of Hanford route (if they can’t get Hwy 99) for a station site that would be closer to their population cnters.
Kings County would prefer Hwy 99 routing as well but railroad giant Union Pacific won’t hear of it and the CHSRA has taken it off the table.
Resolution of the legal issues will have to happen before the 114 mile, $7 billion segment begins construction.
With funding approved now, CHSRA hopes to begin construction of the Central Valley segment that runs Fresno to Merced area late this year but also faces several lawsuits first.

SLO Beat: Homes Sales/Bed Tax Higher

San Luis Obispo single family home sales were higher in June reports California Association of Realtors. In June 2012 the median price of a home was $387,500 compared to $382,470 in May and $364,759 in June 2011. Sales of existing homes increased 9.7% from  a year earlier but were down 13.8% from May 2012.

Another key metric, time on the market – also improved in June in SLO County.It took an an average of 42 days to sell a home in June 2012 -down from 42.2 days in May and 59.7 days in June 2011.

SLO County appears to mirror the state trends that also show a improving housing market in June 2012.

Statewide

California’s housing market continued to show signs of improvement in June, as home sales experienced solid gains annually and home prices reached their highest level since August 2010, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said.
“Although home sales throughout the state continued to improve compared with a year earlier, we did see a modest dip compared with May,” said C.A.R. President LeFrancis Arnold.  “Potential home buyers are frustrated by limited number of homes on the market for sale and growing discouraged by signs that the economy is slowing.”
Closed escrow sales of existing, single-family detached homes in California declined 8.6 percent from May’s revised 567,330 to a seasonally adjusted annualized rate of 518,460 in June, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide.  June sales rose 8.5 percent from June 2011’s revised 478,040 pace.   The statewide sales figure represents what would be the total number of homes sold during 2012 if sales maintained the June pace throughout the year and is adjusted to account for seasonal factors that typically influence home sales.
Home prices continued to improve, with the median home price posting both month-over-month and year-over-year gains for the fourth consecutive month. The statewide median price of an existing, single-family detached home was $320,540 in June.
Builder Confidence Rises Six Points in July

Builder confidence in the market for newly built, single-family homes rose six points to 35 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) for July, released this week. This is the largest one-month gain recorded by the index in nearly a decade, and brings the HMI to its highest point since March of 2007.
“Builder confidence increased by solid margins in every region of the country in July as views of current sales conditions, prospects for future sales and traffic of prospective buyers all improved,” said Barry Rutenberg, chairman of the National Association of Home Builders (NAHB) and a home builder from Gainesville, Fla. “This is greater evidence that the housing market has turned the corner as more buyers perceive the benefits of purchasing a newly built home while interest rates and prices are so favorable.”

City of San Luis Obispo Bed Tax Up in May

San Luis Obispo’s transient occupancy tax (TOT) revenues for May 2012 were up by 3.2% from the same month last year and up by 7.5% year to date. These results continue the trend of improved TOT revenue but with the smallest year over year increase of the last six months. The Hampton Inn and Suites, located at 1530 Calle Joaquin, officially opened its 84 room hotel at the end of May.

Midwest Corn Crop Condition Worsens

Hurt by hot weather and drought the USDA reported today that 38% of the corn crop across the 18 largest corn growing states was either in very poor to poor condition.That compares to 30% a week ago in a USDA estimate. Only 31% of this year’s crop is in good to excellent shape.That compares to 40% a week ago and 66% a year ago says USDA.

Some states have been hit even harder with 72% of this years corn crop in either vey poor to poor condition in Missouri and 77% in Kentucky. Only 11% of the Texas corn crop is in that category.

In California the latest USDA report says farmers planted 610,000 acres of all types of corn, down 3% from last year but expect to harvest 20% more grain corn than last year. Across the US, USDA had expected to harvest 6% more corn than last year but the drought appears  to be putting a big dent in that prediction.

Corn for December delivery moved to $7.86 per bushel on the Chicago Board of Trade today up form just $5.20 in June.

More alfalfa hay in California this year – 980,000 acres – up 100,000 acres (11%) from last year, a size crop that could reduce the sky high price for this important dairy feed. China has been importing more US grown alfalfa hay,177 thousand metric tons last year.

Last year dairy leaders urged dairymen to plant more of their own feed to offset the high prices for both corn and hay in the marketplace.

LA Ports See More Traffic

Both the Port of Long Beach and Port of Los Angeles saw an increase in traffic in June.
At the Port of LA total container traffic was 8.7% higher and loaded outbound containers (exports) were a robust 6.9% higher than a year ago.
Both import and export container traffic at the Port of Long Beach rose in June compared to the same period a year ago, with imports up 3.5 percent and exports up 5.6 percent.
Last month, Long Beach Port terminals moved 280,526 TEUs, or twenty-foot equivalent container units, of loaded inbound cargo compared to 271,113 TEUs in June 2011. Export containers accounted for 133,649 TEUs, compared to 126,588 TEUs in June 2011.
June was the busiest month year to date for calendar year 2012 at Long Beach. Through first half of the year, overall container traffic at the Port is down 5 percent. The decrease in volumes is partly due to the elimination of several niche service strings that had called at the Port last year.

Travel/Tourism News

SkyWest Losing Fresno Contract

SkyWest Airlines has lost its ground baggage contract with United in Fresno resulting in the Utah-based firm sending a warning to employees they will lose their jobs by August 21. The company filed a state WARN notice in recent days. Fresno Airport spokesperson Vikkie Calderon says it is her understanding that the new baggage handler will be Delta Global Services who are already interviewing for employees at FAT.

A spokesperson for SkyWest confirmed the news adding that the company is working to find jobs for its current employees. Also,Skywest will continue to operate flights out of Fresno for United and Delta.

As of 2010,SkyWest employed over 11,000 people throughout North America.

Calderon says otherwise the airport is busy with Allegiant offering weekly service from Fresno to Hawaii and twice a week service beginning in November. Also, Alaska Airlines is now offering twice a day service to San Diego.

Through May FAT passengers totals are slightly ahead of last year.

LA Tourism Up This Summer

Los Angeles has a busy May with the average hotel occupancy rate in Los Angeles County at 77.3%, up by 2.7% from the previous year according to PKF Hospitality Research. Statistics from the LA Tourism board show hotel revenue up even more, with RevPAR up nearly 11% in May even with 1.3% fewer passengers through LAX. Long Beach airport passengers are up 12% year to date.

Helping to boost visitor interest this year is the $1 billion investment by Disney in their California Adventure theme park at Disneyland that was opened this summer. Last year Disneyland attracted over 16 million visitors and logged a 1% increase over 2010. California Adventure park attracted over 6 million,also a 1% increase.

Over spring break Disneyland reported an attendance record as all Disney parks in the US recorded a 7% increase for the latest quarter ending March 31.

Kern Sees More Air Passengers

Bakersfield’s Meadows Field passengers totaled a few hundred ahead of last year in May, higher for most of the calendar year.

Yosemite Travel Up In May

The NPS reports Yosemite saw a 7.1% increase in recreational visitors in May compared to the same month a year ago The number of buses increased 68%. Concessionaire lodging was 4.1%.

SLO Airport Travel Stalls

San Luis Obispo county airport saw a 11.3% decline in passengers in May compared to same month a year ago.

MORRO BAY ASSURED POWER PLANT TO RUN A FEW MORE YEARS

Morro Bay got  some good news this week.The Morro Bay power plant owned by Dynegy Inc will likely not close at the end of this year as had been feared (as well as budgeted) by the city. Instead, the aging plant will continue to operate at least another 2 years mayor William Yates says.

Council including Yates was informed of these new insights at the July 10 city council meeting that talks with Dynegy had yielded this news since the June 26 city council session. If that proves out, it means an extra $500,000 to the city’s General Fund and $250,00 to the Harbor Fund from current agreements with the company. Those agreements include the Outfall Lease and Community Development Fund payments made by the plant operator to the city each year.

Fears the plant could close sooner than later have been fanned in recent weeks as Dynegy lost a power contract with SCE and on top of that, the huge firm declared bankruptcy Friday – adding to a sense of doom.

But Yates insists that “the bankruptcy issue is irrelevant” and the main issue is whether the power plant runs.The plant does have an agreement with the state ISO who operates the power grid to sell them the power when it needs it.

“They needed it today.The plant was running” says Yates.”We know the plant is last in line to run – so when it does run we know the state is really cooking” quips Yates.

Indeed, today was said to be one of the hottest days across the state this summer.Yates says since they lost the contract the plant has run”only a couple of times”

“We don’t know the future but at least for budgeting purposes this is encouraging. A few weeks ago we were expecting them to close by the end of the year.”

UFW Wins Vote At Fresno County Ranch

The United Farmworkers Union won an election held July 11 at a Firebaugh vegetable farm  the Agricultural Labor Relations Board confirms. In the vote at Gargiulo Inc, the UFW won vs no union by 186 – 40 out of 228 votes.Two ballots were contested.

The victory by the farmworkers union is the second in recent weeks with the vote at a Chular vegetable farm,George Amaral Ranches won by the union 265-65 June 21. The ALRB has yet to certify the results which can take a few weeks.

Lawyers for Amaral claim a union strike by the UFW is a violation of the law after the union demanded a contract after the vote count.
The UFW got it first major contract in the tomatoes a few weeks ago at
Tracy-based Pacific Triple E Farms,one of the largest fresh tomato grower  the employes around 800 workers.
Also in recent weeks Salinas Valley grower D’Arrigo Bros. was ordered by a judge  to “cease and desist” from assisting or encouraging any decertification campaign against the United Farm Workers union, The union and grower have been at odds over a contract for decades.
The union founded by Cesar Chavez has had a bust summer so farm after years of not much activity.Some believe a change in the state law that make it easier to prove bad faith in farm elections as well as a labor shortage in the fields may be making a difference this year.
“The labor supply is very tight right now,” said Norm Groot, executive director of the Monterey County Farm Bureau. Growers of commodity crops being harvested now are “scrambling to keep crews in place,” he said according to a local newspaper.

California Export Trade Resumes Growth, Despite Global Turmoil

 LOS ANGELES, CALIFORNIA – California’s export trade recovered from its April stumble and resumed a positive growth track in May, according to an analysis by Beacon Economics of foreign trade data released this morning by the U.S. Commerce Department.

The value of goods shipped abroad by California businesses in May totaled $13.88 billion, a nominal increase of 5.2% over the $13.20 billion recorded in May 2011.

California exports to the European Union were down 10.3% from May of last year, while export shipments to the nations of the Pacific Rim were up 4.0%. Mexico continued to be the state’s largest and most vibrant export market, with exports in May up by 23.9% over May 2011.

“Given the generally parlous condition of the global marketplace these past few months, May’s overall numbers demonstrate the resilience of California’s export industries,” said Jock O’Connell, Beacon Economics’ International Trade Adviser.

The state’s manufactured exports in May were particularly impressive, jumping by 7.4% from $8.54 billion last May to $9.18 billion this year. Re-exports nudged up by 2.2% from $2.93 to $3.00 billion. However, exports of non-manufactured goods – chiefly agricultural products and raw materials – did slip by 1.1% from $1.72 billion in May 2011 to $1.70 billion this May.

The growth in manufactured exports has been particularly helpful in boosting manufacturing employment in the state, which is up by more than 10,000 jobs since hitting bottom in September 2009, according to Beacon Economics’ Director of Economic Research Jordan Levine. “Although the pace of export growth has slowed from the double-digit increases we saw in 2010 and 2011, and despite the turmoil abroad, continued solid demand for California-made goods and services is helping drive employment in the manufacturing sector,” Levine said.

Beacon Economics’ analysis also reported that, adjusting for inflation, the value of California’s exports so far in 2012 is running approximately 5% ahead of 2008, formerly the peak year for the state’s export trade.

“With the dollar stronger by more than 13% over last year at this time, much of Europe mired in recession, and slowing economic growth in major economies in Asia and South America, California exporters are facing some severe headwinds but are still coming out ahead of the game,” O’Connell said.

Still, global economic conditions could deteriorate further and affect California’s export trade, especially if efforts by European leaders to resolve the European Union’s debt drama continue to leave the world’s financial markets unimpressed, according to O‘Connell.