DETROIT – The number of vehicles in use on U.S. roads in 2001 grew by the smallest margin in the last four years, as high scrappage rates partially offset record new vehicle registrations for the last two years, a Ward’s analysis of the latest data available from the Polk Co. shows.

Significant is that the smaller increases could be a leading indicator of renewed growth for the U.S. market in coming years.

As of June 30, 2001, total vehicles registered in the U.S. were at a new high of 216,682,936, an increase of 1.8% (3,383,623 units) from year-earlier totals. The gain was the smallest since a 1.4% (2,776,938 units) rise for the 12-month period ending in June 1997.

See related data: 2001 Registration

The number of new vehicles registered during the same period was 17,505,343, the second highest on record for any 12-month period ending June 30. But it remained 3.2% below the prior year’s – and previous record – 18,088,911. The falloff was the biggest year-to-year since a 9.4% drop in 1991, the trough of the last recession. It also marks only the second year since then that new registrations declined from the prior year.

The number of vehicles scrapped for the year ending June 30, 2001, also was the second-highest total, surpassed only by the record set the previous year. Some 14,121,720 vehicles were taken out of circulation, 1.2% below the prior year’s 14,298,759.

Scrappage as a percentage of new vehicle registrations increased for the second consecutive year to 80.7% from 79.0%. It was the highest since 81.8% in 1997. Also, scrappage as a percentage of vehicles in use was 6.6% for the 12-month period ending June 30. Except for the previous year’s 6.8%, it was the highest since a similar rate for the same period ended in 1994.

High percentages for these two scrappage measures indicate potentially healthy levels of pent-up demand for new vehicles.

Furthermore, vehicle population growth usually outpaces any gains in the number of licensed drivers. When registration increases are smaller than the change in the number of licensed drivers, the growth rate in demand for new vehicles usually improves within the next two years.

The percentage growth in vehicle population ran slightly below the increase in number of licensed drivers in 2000, according to the most recent year data is available. (Note: licensed driver data is for the calendar year, whereas the vehicle registration data is of June 30 of the stated years.) That could be an indicator of another sales rebound in 2003, especially if the registration growth line again falls below the rate for licensed drivers.

Meantime, the geography of new vehicle registrations continues to favor a movement west. Based on calendar year totals, penetration was up in 2001 from 2000 in the West North Central and Mountain regions, both areas that have been experiencing general increases in new vehicles for several years.

The Pacific region, which has had the strongest growth in recent years, declined to a 14.9% share in 2001 from 15.2% the previous year, thanks to downturns in the smaller-volume states of Oregon and Washington. But that followed dramatic growth since a 13.1% penetration rate in 1995. The Pacific region includes California, where more than one-in-10 new vehicles in the U.S. are sold. California’s share increased to 11.3% in 2001 from 11.2%.

The East North Central region stopped three years of decline that saw its share drop from 18.5% in 1998 to 17.1% in 2000. Big gains in Michigan, Indiana and Illinois boosted the region’s penetration to 17.5% in 2001.

After two straight years of growth, the biggest region in new vehicle penetration, the South Atlantic, recorded a small decline in share to 20.7% from 20.8% the prior year. Downturns in North Carolina, South Carolina and Virginia offset continued gains in Georgia and Florida.

New England maintained share of 4.9% for the fifth straight year, and share for the Mid-Atlantic states (New York, New Jersey and Pennsylvania) fell to 13.1%, lowest since 13.0% in 1998. The East South Central (Alabama, Kentucky, Mississippi and Tennessee) had its third straight market share decline, with a 4.6% penetration rate in 2001, compared with 5.2% in 1998.

States with the biggest percentage gains in new registrations in 2001 over 2000 were Massachusetts (3.5%), Colorado (3.4%), Alabama (3.3%), Michigan (3.0%) and Maryland (2.9%). The biggest declines occurred in Washington (down 1.0%), Oregon (0.8%), Arkansas (0.7%), and North Dakota and South Dakota, both down 0.3%.

Meantime, the median age for both cars and trucks declined in 2001 from the previous year. Cars average 8.1 years of age, down from 8.3 for three consecutive years. Trucks are at 6.8 years, compared with 6.9 years in 2000, and as high as 7.8 years in 1997. It was the first time the median age for cars had declined since 1989, while trucks have dropped four straight years and are now at their youngest since they registered the same median age in 1991.