Peak Car: The best arguments are on the business pages

In this case, in the Washington Post: Nobody Wanting to Drive in Megacities Signals Vehicle Peak

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 Feb. 24 (Bloomberg) — The world that Henry Ford put on wheels is poised for a stall.

The world will reach “Peak Car” — a point at which annual global sales growth will top out — in the next decade, several auto-industry analysts predict. Researcher IHS Automotive, for one, sees annual sales cresting at 100 million within that time.

Peak Car is at odds with the ambitious expansion plans of global automakers, which IHS says are gearing up to produce more than 120 million vehicles by 2016 — almost 50 percent more than last year’s worldwide sales mark of 82 million. The dynamic also threatens the business plans of parts producers, suppliers of raw material and oil companies.

Driving this upheaval is a rapidly emerging reality: The vehicle that ushered in an unparalleled era of personal mobility in the last century is, in many cases, no longer the most convenient conveyance, particularly as more of the world’s population migrates to big cities. …

The case for growing gridlock has been presented by PricewaterhouseCoopers, among others. Today, half the world lives in urban areas. Over the next decade, there will be a 25 percent to 50 percent increase in urban dwelling, as about 1 billion people move into cities, according to PwC.

In 25 years, there will be 9 billion people living in urban areas — more than the entire population of the Earth today. If they are all driving cars, gridlock could block the path of food, water and emergency medical treatment in urban areas, said PwC’s Ryan. …

Ultimately, urban dwellers will order a ride to work on their phones, get picked up by a driverless car and whisk through traffic controlled by satellites and sensors that get them to the office safely and quickly, said Thilo Koslowski, auto analyst for researcher Gartner Inc. of Stamford, Connecticut. U.S. regulators said this month they’ve begun working on rules to let vehicles communicate via wireless chips while on the road.

For the world’s automakers and suppliers, that means making cars won’t be enough anymore, Ryan said. They have to transform into transportation-service providers that cater to consumers who don’t want the hassle and expense of owning a car and instead just want to rent one that comes when summoned, he said. …

For every vehicle that is used in a car-sharing fleet, automakers will lose 32 vehicle sales, according to a study this month by AlixPartners.

“The likelihood is pretty good that we have reached the peak per person or per household” in the U.S., said Sivak, who has produced five studies on the topic. “We have fewer vehicles and we drive each of them less.”

Some of the decline in vehicle ownership in the U.S. can be attributed to the 18-month recession that ended in June 2009 and the relatively slow recovery since, Polzin said. As people regain wealth, he said, some of those trends will reverse….

“It’s really pretty hard to go to somebody and say ‘Can you imagine a day will come when you won’t need a car?’” said Phil Gott, senior director of long range planning at IHS in Lexington, Massachusetts. “Because the obvious answer is ‘What, are you nuts? I’ll always need a car.’ But in fact, people are moving into the cities and doing with fewer cars and in some cases with no cars.”

Full story here.