How To Get Around The Peak Car Conundrum
BY: Dr. Peter Graf and Gil Perez
By all accounts, the global automotive industry is on a run. Sales are surging globally. Advances in hybrids, electric vehicles, and even conventional petrol engines are delivering eye-popping mileage gains.
Yet dig a little deeper into sales patterns and it turns out automakers face a worrisome trend. Data suggest that many wealthy economies have hit “peak car,” a point of market saturation characterized by an unprecedented deceleration in the growth of car ownership, total miles driven, and annual sales.
In the United States--the cradle of the global automotive industry--the number of miles driven per vehicle has leveled off over the past decade, after a century of upward growth. In Europe and Japan, the story is similar: the distance each vehicle travels has been declining since around 1990. Even for newcomers Brazil, China and India--the world’s fastest growing auto markets--romance with the car may sour quickly as urban jams become the new normal.
The factors behind the peak car conundrum are at once familiar and a little surprising. The first--congestion--is a visceral force, familiar to any driver. The second factor--the web--may be less obvious, but poses a potent drag on growth of new drivers.
*This article originally appeared on Fast Company's Co.Exist Blog
