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Vehicle sales to reach 'peak car'?

2014-03-02 11:29

SURE I CAN TALK, NOT DRIVING: Imagine you could be dropped off at a shopping centre or workplace and leave your vehicle to the tedium of finding a parking spot. Automaker’s such as Volvo might soon make this reality. Image: Volvo

CHICAGO, Illinois – Fuel price, traffic, public transport... analysts believe the auto industry will head into a new era and reach “peak car” - a point at which annual global sales growth will stop.

In many of world’s cities commuters are ditching cars in favour of public transport, bicycles and sharing vehicles. Some analysts believe that, as fuel prices rise, traffic continues to snarl and pollution spreads, so vehicle sales could top out and even start to decline.


This grim prediction will also have a drastic effects on parts suppliers, raw-material producers and oil companies.  Researcher IHS Automotive sees annual sales cresting at 100-million within that time, reports the Detroit News.

The analysis is at odds with expansion plans of automakers. IHS Automotive reports that more than 120 million vehicles will be built by 2016, 50% above the 2013 figure of 82-million.


Consulting firm PricewaterhouseCoopers' vice-chairman of markets and strategy, Tim Ryan, told the DetNews: “The key question 'do you sell cars or do you sell mobility?' If you ignore these megatrends you run the risk of becoming irrelevant.

 “People won’t stand for spending 25% of their life commuting. The way they will get around in the future will be different.”

According to PwC, in the next 10 years there will be “a 25-50% increase in urban dwelling, as about a billion people move into cities”.

PwC’s Ryan reports that in 25 years there will be nine- billion people living in urban areas, more than the entire population of the Earth in 2014. If they are all driving cars gridlock could block the transportation of food, water and emergency medical treatment in urban areas.


Many automakers are preparing for changing markets with research into automated vehicles in an effort to curb traffic jams.

According to a survey published by Intel Corp, 44% of US drivers would prefer to live in a city with automated cars that could reduce congestion. In US nearly one in ten households don not have a vehicles, an increase of 5.7% since 2009, reports DetNews.

Automotive analyst for Gartner Inc, Thilo Koslowski, believes that drivers will order a ride to work on their cellphones and are picked up by a driverless car controlled by satellites and sensors.

Ryan said that for automakers and suppliers, building cars won’t be enough. Automaker’s will have to transform into transportation-service providers and cater for customer who want to rent an automated ride rather than purchase their own car.

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