Economy: Are We Close To Peak Car?

 

(Drivebycuriosity) - It seems the media is obsessed with peaks. There have been a lot headlines about "peak oil", claiming that the global oil production will soon reach its peak and will start shrinking. The media also wrote about  "peak consumption", "peak income", "peak life expectancy" and other alleged peaks (driveby). Recently Bloomberg announced the "dawn of the peak car era" (bloomberg).

According to Bloomberg, "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". They wrote further: "In the globe’s growing megacities, pollution and gridlock are putting a damper on driving." And: "more young Americans are forgoing the dream of auto ownership for public transport, bikes and vehicle-sharing" and "Cars on the road are lasting longer than ever".

It is strange that the article didn`t mention the high gas price. Today oil and gas cost around 3 times their average price in the 1990! It would be surprising if consumers would not respond to this triple and would not drive less. High gas prices work like a tax on commuting from rural areas to working places, shops and leisure spots. Today´s gas prices make living in cities more attractive because the commuting ways are much shorter - and cheaper, thanks to subway and buses. Some people, who migrate to the cities might even give up their cars.

However, I am skeptical with all peak theories and I am not convinced that we will see the dawn of "peak car" soon. The end of the car era had been often announced. But the car industry always found ways to beat the pessimistic expectations. Many people love cars, they have fun driving, they enjoy the mobility and the prestige which comes with some of the vehicles. And the car industry is adapting to the challenges, using more and more technology. Thanks to advances in engineering cars are getting more and more energy efficient and they offer more and more comfort. They even get a bit safer and less polluting.

New developments like Tesla´s electric car and Googles driverless car show some of the ways technology could go. Thanks to mass production and technological progress those and other innovations could become affordable for a huge part of the global population.