If California's freeways look like they are jammed with Toyotas, it's not an illusion.

The Japanese brand dominates the state market with 27% of sales, according to a report by the California Motor Car Dealers Assn., representing 1,350 dealers.

Meanwhile, the report adds that the state's new-vehicle registrations declined 5.5% during the first half of this year versus a year earlier.

The report predicts that new light vehicle registrations (including retail and fleet transactions) in the state will decline 3.1% from 2005 to 2006. Cited reasons include high fuel prices, elevated consumer debt levels, and rising interest rates.

That doesn't mean the nation's largest car market is “on the precipice of a pronounced and prolonged decline,” says Bert Boeckmann, assn. chairman. “Registrations are still likely to exceed 2,090,000 units, which historically is a very good year.

“In addition, the manufacturers are adept at introducing new products that hit consumer hot buttons, providing a strong motivation for consumers to visit California new car dealerships.”