Calitics addresses the question.
As this Kos post notes, the changing state demographics towards non-white and young voters doesn’t bode well for Republican futures. The state GOP is heavily influenced by cultural conservatives in the valley and Orange County, and that used to be enough to combine with Republican moderates to guarantee Republican wins statewide. But since the massive military industry shutdowns of the 1990s and the rise of the high tech industries at about the same time, it has been difficult for the Republicans to field a candidate which can survive a hard-right primary and have serious chances in the general election.
Earlier this decade they managed to slip Schwarzenegger by that process through the Davis recall, after having failed badly with a hapless right wing candidate in the prior election. This year the Democrats swept the statewide races, with the closest race being so probably because the Democratic candidate’s name is Kamala. The Republicans squandered their two opportunities for House turnovers, and quite frankly I don’t believe a Senate turnover was ever a very serious possibility. In the state legislature, the Republicans actually lost an Assembly seat. This in the “year of the tea party,” in which Republicans were angry and hungry, and Democrats demoralized and apathetic.
It’s not going to get easier for them. The Hispanic vote leans Democrat heavily, and they represent 22 percent of the electorate and growing. Meg Whitman took the white vote and the over-65 vote, but as more baby-boomers slip into the latter category the more conservative causes will lose their stranglehold there.
The other problem they have is that the moderate Republican is becoming an endangered species. About the only real “conservative” takeover I can find statewide was in Humboldt County, and the new Supervisor representing the Eureka area, Virginia Bass, has left the GOP. By her account, the social issues were a heavy factor.
The top-two primary could offer Republicans opportunities to put up moderate candidates since they don’t have to survive the primaries, but it’s just as likely that races could fall between a liberal and a moderate Democrat, with the Republican Party being shut out of statewide races altogether.