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Are There Halfway Steps to Car Ownership?
by Bradley B. • April 5, 2019


The Halfway Steps to Car Ownership

The 100-year-old era of the private automobile is soon coming to an end. That’s what you might be led to believe from some news sources. Meanwhile, other media pundits argue just the opposite—that private car ownership is now revving up for another century of dominance. As usual, the truth lies somewhere in between, in a middle ground that thankfully offers the ability for convenient personal transportation without the historic hassles of car shopping and maintenance.

The first camp—the car-is-dead crowd—points to the advent of ride-hailing apps, car-sharing services, and shared scooters, as well as emerging self-driving technology, as the beginning of the end for private cars. The most cited evidence of so-called Peak Car is young people delaying getting a driver’s license.

Professor Michael Sivak, a transportation researcher at the University of Michigan, reports that only 26 percent of American 16-year-olds obtained a driver’s license in 2017. A generation ago, in the 1980s, twice as many of those teenagers rushed out to get a license to drive as soon as they could.

The decline in driving among young people is not only attributed to the new mobility alternatives, such as Uber and Lyft. It’s also explained by the 2008 recession that made Millennials less able to afford a car. According to the Federal Reserve Bank of New York, a decade later, seven million Americans of all ages fell three or more months behind in their car payments.

Economics doesn’t explain it all. Researchers also believe that social media and smartphones satisfy the desire among younger folks to connect without having to leave the comfort of home. Furthermore, demographic trends indicate that young people are increasingly moving into urban areas—for example, to find work. Why buy and maintain a car (and pay through the nose to park it) in a city that is walkable or has robust public transportation and other mobility options?

Not So Fast

These trends and social forces are real. But you can’t assign the same reasons for declining rates of car ownership to every region of the United States. After all, most American cities are not like transportation-rich San Francisco, Los Angeles, and New York. In many U.S. communities—especially sprawling suburbs and rural areas—a personal car is an absolute necessity for getting to work, everyday errands, and weekend getaways.

Ditching a car and taking Ubers sounds enticing. But most people—especially as they become more financially secure and start a family—want and need a car. The National Bureau of Economic Research released a paper this year arguing that Millennials aren’t permanently ditching cars. They’re just delaying the purchase for a few years.

Most people, no matter their stage of life, see comfort and convenience in keeping gear stowed away in a vehicle’s hatch or trunk. Also, being able to jump in your own car and go, or take detours as needed without the meter running, is a boon. Besides, some of us enjoy driving and love owning a speedy roadster, hard-working pickup or other vehicle that reflects our lifestyle and personality.

The National Automobile Dealers Association found in early 2019 that the decline in young adults buying cars from a decade ago is now back on the rise.

Can You Have It All?

The so-called sharing or gig economy, as it relates to transportation, is not just about a car-free life via ride-hailing apps and shared scooters. Fortunately, urban dwellers and suburbanites alike can now access a car when they want one via on-demand services, such as shared cars available for a ride, the day, or by the month.

There are peer-to-peer car-share services that allow you to pay a neighbor for access to their vehicle on an as-needed basis. We are also starting to see more roaming, pay-as-you-go car services that work just like shared, station-less bicycles and scooters. These offering allow you to locate a car parked on the street, open the door with a mobile app, and drive to the desired location. When you’re done, simply park and lock the door—and pay only for the time or mileage you used.

Like these vehicle-sharing services, monthly car subscriptions can similarly eliminate the hassle of buying, financing, insuring and maintaining a vehicle—while still granting you all the conveniences of ownership. The all-in-one monthly subscription payments are usually less expensive than getting separate bills from a financing firm, insurance company, and friendly neighborhood mechanic or tire store. Moreover, it’s up to you if you subscribe to a car for a month, a year, or multiple years. Many of these services allow you to swap from one vehicle to another in the subscription plan.

Here’s the main point: Using a personal vehicle to get around is no longer a one-size-fits-all, either-or proposition. Sure, some folks are happy to say goodbye to a private automobile. More power to them. For others, you can’t pry the steering wheel from their hands no matter how hard you try. But for the vast majority of commuters, travelers, and car buffs, there’s a cost-effective and convenient solution somewhere in the middle.