The automobile has more or less been the champion of personal mobility for the last century, but taking a closer look at the global mobility landscape shows signs of change – change caused by disruptive mobility services that together with increasing congestion and pollution problems are phasing out the traditional way of owning a car and moving us all closer toward the peak of car ownership.
One sign of peak car is that the sale numbers of automobiles have started to decline in important markets. In the US, car sales are now declining after record years, and market analysts say there is a good chance they may never recover again . In China, January marked the seventh month in a row of declining car sales with a staggering 18% monthly decline. This trend is likely caused by the arrival of new mobility services like ride-hailing and micromobility options, coupled with the increased cost of buying and owning a personal vehicle. China’s Didi supplied 550 million Chinese with 10 billion ride-hailing trips in 2018 – double that Uber provided globally for the entire year. In the US, buying a new car averaged a record high of $37,777 in 2018. Add to that the increasing introduction of congestion pricing in many big cities along with areas that restrict access for cars (for example in Madrid, London and Mexico City) and the argument for getting around without owning a personal car is becoming clearer by the day.
Another aspect worth mentioning is that the younger generation is letting go of their interest in personal vehicles. In the UK, the number of 17-year-olds taking driving tests has declined with 28% in the past decade. In the US, only 26% of 16-year-olds earned a driver licence in 2017, another record low .
By some analysts, mature mobility markets could already be at peak car – with the developing markets being predicted to reach it in tandem with wide-scale deployment of self-driving vehicles, expected to take place by the end of the 2020s – which would also likely mark the peak of car ownership globally.
It is hard to argue with the numbers laid forth regarding auto sales, costs of ownership etc. and say that they do not point to the same fate for the automobile. However, this may not mean that the automobile itself will become obsolete, merely adapt to a new paradigm – the sharing economy. A growing number of OEMs are seeing the signs mentioned above and have thus started to shift themselves into fleet managers instead of selling cars to individuals, supplying their customers with everything from traditional station-based carpools to self-driving robo-taxis – services that all still require an automobile.
Written by Darijan Jelica, RISE Viktoria.
1. 2019-02-28. This is what peak car looks like.
2. 2019-01-13. The next American car recession has already started.