Automotive Business Kept the Dollars Rolling In : County’s Taxable Sales in 1985 Reached $20.2 Billion

Times Staff Writer

Spurred along by the booming automobile and construction industries, Orange County’s economy continued growing at a healthy clip last year as consumers spent a record $20.2 billion on taxable goods and services.

And one state official predicts more good economic news for this year. Ernest J. Dronenburg Jr., a member of the state Board of Equalization which publishes the annual taxable sales report, said he believes that the recent steep decline in oil prices will stimulate the economy by leaving consumers with more disposable income than in past years.

Although the county’s taxable sales represent a robust 9.1% growth rate for 1985, the board’s figures show a significant slowing from the 17.6% increase posted in the county in 1984.

Less Inflation


But Dronenburg said he doesn’t believe the figures mean that the county economy is any worse off because the 1984 figures were affected by a higher rate of inflation that year.

The Consumer Price Index, which the state uses to adjust the annual statistics, overstates the impact of inflation when inflation rates are low--as they were last year. The reverse is true during hyperinflationary periods, he said.

In 1985, the county’s 9.1% growth rate outpaced the state’s 7.3% growth in taxable sales. The $206.8 billion statewide total was up $14 billion from 1984, according to the report.

Consumer spending in Orange County was second only to the $61.7 billion spent in Los Angeles County. San Diego took third place with $15.3 billion in taxable sales.


Among the larger counties, Orange County posted the ninth-fastest growth rate last year. San Bernardino was first with 15.3%, followed by Placer County, 13.8%; San Diego County, 11.9%, and Sacramento County, 11.4%.

Dronenburg said Orange County’s comparatively strong showing is because of the overwhelming presence of the automobile and construction industries.

Vehicle Sales

“I think it (Orange County) sells a whale of a lot of cars,” Dronenburg said. “And you can just see the impact. That’s why Orange County did so well.”


Orange County’s auto dealers and auto supply sellers collected $3.9 billion in taxable sales revenue last year--more than was spent on all taxable goods and services in 46 other California counties.

That figure includes more than $2.2 billion on new cars and trucks, $1.1 billion spent at service stations, $132 million at used car dealerships and $201 million on parts and accessories.

Orange County merchants took in $2.1 billion at general merchandise stores, $1.7 billion at bars and restaurants and $920 million at building supply stores.

The Southern California region maintained its hold on second place in growth last year among the state’s four regions with an 8.8% growth rate in taxable sales.


San Francisco Bay Area counties, which boasted the state’s highest growth rate for the past three years, slipped to third place with a 5% increase in 1985. Northern California and the mountain counties enjoyed the highest increase in taxable sales in 1985 for the first time in seven years with a 9.5% increase in taxable retail sales. The San Joaquin Valley region continued in last place with an annual growth rate of 4.4%.

Sales in North Improve

Dronenburg said the numbers signal that that northernmost region of the state finally is coming into its own.

“It’s definitely a positive sign for the new leader,” he said. “But it’s not a negative sign for the old leader.”


Orange County cities with the largest share of the county’s taxable sales were Anaheim, $2.5 billion; Santa Ana, $2.1 billion; Costa Mesa, $1.6 billion; Huntington Beach, $1.35 billion; Orange, $1.31 billion, and Irvine, $1.2 billion.

Other major retail areas in the county were Fullerton, $970 million; Garden Grove, $926 million; Newport Beach, $845 million; Buena Park, $790 million, and Westminster, $637 million.