A publication of the Indiana Business Research Center at IU's Kelley School of Business
Share | |

Hoosiers Strongly Prefer Domestic Autos

Although foreign car brands continue to take U.S. market share away from domestic nameplates, Indiana drivers still show a strong proclivity to own American vehicles.

The latest data from the Indiana Bureau of Motor Vehicles (BMV) show that 80.6 percent of Indiana vehicles registered in 2004 bore the names of U.S.-based manufacturers, while 19.4 percent were foreign-based brands. This compares to 2005 national registration shares of 51 percent for domestic makes and 49 percent for foreign makes. (1)

As shown in Table 1, Chevrolet and Ford were the two most popular makes, together accounting for nearly a third of all vehicle registrations in Indiana. Nationally, Toyota recently overtook Ford for the number two position, but in Indiana four other domestic brands (plus the classification of “other domestic”) had more vehicles registered than Toyota. (2) General Motors held four of the six top individual-make spots, with Daimler-Chrysler and Ford each providing one of the top six positions.

Table 1: Indiana Vehicle Registrations by Make, 2004

Table 1

With a total of nearly 3.3 million registered vehicles, there are approximately 1.2 vehicles per Indiana household, or 1.9 Hoosiers per car or truck.

The distribution of vehicles by make varies greatly from county to county in Indiana. Figure 1 shows the relative concentration of foreign-brand vehicles by county using an index where 100 equals the average concentration for the state as a whole. For instance, the foreign-brand index for Monroe County is 182, meaning that Monroe County residents are 82 percent more likely than the average Hoosier to have a foreign-brand car or truck; this is the highest relative concentration of foreign-make vehicles in the state, followed closely by Hamilton and Floyd counties.

Figure 1: Concentration of Foreign Vehicles by County, 2004

Figure 1
Click for zoomable flash document

The corresponding relative-concentration indexes for domestic-make vehicles do not vary nearly so much as for foreign makes because of the overwhelming dominance of domestics in the Indiana market. The large share of total registrations accounted for by the combined domestic brands makes it mathematically unlikely for very high or low concentrations relative to the average to emerge. The highest domestic concentrations were found in Miami and Pulaski counties at 117 (their residents were 17 percent likelier to own a domestic make than the average Hoosier), followed closely by Adams, Blackford, Fulton, and Grant at 116 and Tipton and Wabash at 115.

Although Chevrolet holds the top spot in 79 counties and Ford in the other 13 counties, other individual makes vie for the runner-up positions. It's interesting to examine the relative-concentration indexes by county for various vehicle brands, looking for unusually high numbers that indicate a particular make of vehicle is much more likely to be found in that county than elsewhere in the state. The full table of makes-by-counties is too large to include in this article, but it is available on the STATS Indiana website at www.stats.indiana.edu/vehicles.html.

Henry County, for instance, has indexes of 249, 268 and 289 for Chrysler, Dodge and Plymouth vehicles, respectively, the top concentrations in the state for these stable-mate brands. This may reflect that county's heritage as a producer of Chrysler products and supplier to that firm and perhaps the continued presence of retirees who qualify for employee discounts. It may also reveal a persistent brand loyalty years after local production of those vehicles ended.

Hamilton County also has very high relative concentrations for several makes, but probably for different reasons. Hamilton County has the state's highest relative concentrations of five foreign brands: Acura (327), BMW (324), Jaguar (226), Mercedes (262), and Porsche (304). Dealers for these brands are not found in many parts of the state, but are present in this county, and Hamilton County residents tend to have the higher incomes needed to buy such brands.

Notes

  1. Source: R.L. Polk and Company. In this article, foreign and domestic refer to the location of the makers' headquarters. In fact, much of the production and assembly of foreign-based automakers occurs at plants in the United States.
  2. Only the makes reported separately by BMV are specified; others are lumped into the “other domestic” and “other foreign” categories.

Jerry Conover, Director
Indiana Business Research Center, Kelley School of Business, Indiana University