Will the global vehicle market (all automakers combined) be bigger or smaller in 2030 and why?

[jbcarioca]

Maybe we are overthinking this question:
First, the most consistently major auto markets other than the US have either declared that ICE sales must cease sometime between 2025 nd 2040 or declared the intent but not yet establishing a date. That, by itself, should generate at the least a demand rise proportionately equal to that which followed World War II. The replacement cycle will accelerate and new entrants will innovate, impediments such as range anxiety will dissipate. Further urban vehicles of all kinds will suddenly grow to being predominately electric.

Forget about market growth LDC's vs developed. The mass replacement cycle will act independently of such factors.

The ICE's that remain will probably go to very, very remote places to the extent that they need them, but most of them will be recycled.

That is my view, but it does depend on political will. That is the big question.

 

[bonaire]

The price of convenience is actually hard to value. Putting a car in a driveway so it's ready to go at any time is huge in value. Now, someone paying $3000-5000/mo rent in Silicon valley - they're stretched. They need ride-sharing. The world is not Silicon Valley.

 

[winfield100]

The price of convenience is actually hard to value. Putting a car in a driveway so it's ready to go at any time is huge in value. Now, someone paying $3000-5000/mo rent in Silicon valley - they're stretched. They need ride-sharing. The world is not Silicon Valley.

what do _you_ really pay per month, or year, for the convenience of a vehicle? are you a rural or urban dweller?
consider the folks wo are urban dwellers who make 10-20% of what you make.

 

[bonaire]

what do _you_ really pay per month, or year, for the convenience of a vehicle? are you a rural or urban dweller?
consider the folks wo are urban dwellers who make 10-20% of what you make.

They have had the ability to rent cars for decades - as needed. What ride-share does is allows them to micro-rent. I was hoping Zip Car would take-off but it was not all that big a deal. Car share makes sense. People don't make sense, entirely. And, the people living in cities in tiny apartments (such as one bartender I met years ago sharing a house with 6 co-horts from Ireland trying to survive in NYC for 6-months) shows just how hard it is to live near big cities. City values of real estate hold their values and grow. Rural homes actually depreciate. I was looking at Zillow at a house that started its listing at $2.5M, then dropped, and dropped. Now offered at $895k due to the seller retiring out of state.

I can say that it all depends. Flyover country is where ride-sharing should happen more than cities because of the long miles driving involved. Commuter I met who just got a Tesla says he has a daily 170 mile commute. Why doesn't he just live near work? Because a lot of us work to live. Many in the west coast areas work to live. Who can say driving 100mi each way to a $17-20/hr job in the bay area are doing things "smartly"? This is clearly a need for small-scale van services that run 5-10 people from various hubs to other hubs. Car-pooling can do so much for the world and yet we are now trying to get EVs into HOV lanes so people can conveniently get to work without getting in cars with those "icky strangers" . We have a cultural problem in various ways that makes car-share possibly a slow-mover.

Uber - that works. It is a step above taxi service and you can see why it took off. But how can we actually do car-pooling, resource-sharing, cost savings right?

As for rural car ownership. It's big - people buy their $5k used cars that are 9-10 years old. They drive them for four-five years, scrap them and do it again. They let us "smart, rich people" buy new and enjoy the fast-deterioration of value through depreciation. So, who's really smart here? Insurance is cheaper, no need to keep it pretty and the cost to keep a car is quite low. The real problem is people who "must have" the latest car while stretching their budget to get into one. I met a lady once who worked as a secretary who was upside down in one car, traded it in on a Hyundai Santa Fe and owed $40,000 on that. Seriously, people make horrible decisions. Remember that half the population is below-average intelligence. This is the community that car-sharing must try to reach. How do we dumb down good ideas that will actually take-off? We dumbed down shopping (Walmart) pretty well. Add on Amazon to make it lazy (just order for your couch). Next step - full Wall-E experience of autonomous cars, car-share (remove people's independence) and what else comes after that?

If everyone would take a Dave Ramsey course called Financial Peace University - maybe we could stop all the frivolous spending on new cars and make things like car share work or keeping people out of restaurants unless they work there. The thing is, this teaches people to delay pleasure. People just don't do that - even if working paycheck to paycheck. Car share is an awesome idea - but most people are too selfish to believe it will work out for them. EV drivers who buy a BEV hardly ever want to rent an ICE for the 2-3 times a year long trip. They now have to have 100 kWh on board for those rare trips. This is an example of the selfish nature seen in the transition to EVs.

 

[jbcarioca]

They have had the ability to rent cars for decades - as needed. What ride-share does is allows them to micro-rent. I was hoping Zip Car would take-off but it was not all that big a deal. Car share makes sense. People don't make sense, entirely.

I agree with your entire post. Short term rental is working in some places. It's hard to understand just why they work in some places and not others. My guess is that they'll evolve. Thus far the two I know best are only BEV's and short term ones. They're cheap and functional for some uses and I keep thinking they'll become more popular.

They're spreading in Europe, especially France and oddly enough they're working well in Fortaleza, Ceara, Brazil which comes as a surprise to people not familiar.In both Nice and Fortaleza the people I know who use them are ones who have vacation homes near the rental locations so they use these services rather than either own or rent cars. I really don't trust mother-in-law research so I'm waiting for real data.

Long term it seems probable that urban residents will tread towards ride sharing and occasional short term rentals for much of the activity for which they now own cars. How much impact that will have on long-term vehicle sales I cannot even imagine. There's lots of speculation around but not much solid evidence that I see.

" People don't make sense..."

 

[bonaire]

I agree with your entire post. Short term rental is working in some places. It's hard to understand just why they work in some places and not others. My guess is that they'll evolve. Thus far the two I know best are only BEV's and short term ones. They're cheap and functional for some uses and I keep thinking they'll become more popular.

They're spreading in Europe, especially France and oddly enough they're working well in Fortaleza, Ceara, Brazil which comes as a surprise to people not familiar.In both Nice and Fortaleza the people I know who use them are ones who have vacation homes near the rental locations so they use these services rather than either own or rent cars. I really don't trust mother-in-law research so I'm waiting for real data.

Long term it seems probable that urban residents will tread towards ride sharing and occasional short term rentals for much of the activity for which they now own cars. How much impact that will have on long-term vehicle sales I cannot even imagine. There's lots of speculation around but not much solid evidence that I see.

" People don't make sense..."

Another way to look at it "if you can afford taxis in NYC, you don't take subways". Subways are a fantastic way to get around but many want the convenience of taxis. That basic compare is what will help define what people might do for ride-share industries. I kind of like the Olli bus designed by the guys at Local Motors. Meet Olli · Local Motors

But, it may not be fast and useful enough for rural/suburbia. We need "small scatter-bus" services. 10-16 seats, drivers who just perform the "travelling salesman algorithm" for those who call-upon them for rides. I think the Elon Musk ideas of small buses is good - it would be one way to make shuttle bus services work. But they need to be like bees flying around the countryside - high numbers, ease and convenience and an ability to block riders who are "really icky strangers who we don't want to give rides to" once they show their true colors. I had an Uber the other day - guy told me of a summon he got that was 25 miles away. This customer cancelled the moment the driver pulled up to the door. This is the kind of customer who hurts ride-share. But we would also need to be "ok" putting our 12 year old daughter on a shared bus to go across town. Until then, we have to drive the kid to her dance lessons, or our son to soccer. This means soccer moms and so on will continue. The first world wants convenience and that means car ownership. And having children is INCREDIBLY resource driven. Especially my friend, mentioned above, with the 10 kids. Imagine once his six daughters grow up who are good looking and "probably will want large families also - because they were brought up in one" will be doing.

 

[TradingInvest]

In the long term future, I think the world will maintain 1 billion vehicles, 50% privately owned, 50% shared. Private cars will have a life of 10 years, shared cars will have a life of 6 years. So the stable replacement rate will be ~132 million per year.

By 2030, buying a new autonomous EV will be more economical than maintaining an old ICE. Tesla buyers can buy a car and sign up to the Tesla Network, the real cost probably will be near zero. Assume all brands can do autonomous driving by 2030, the total demand should be very high, probably around 150 million a year.

I guess by then 4 companies will take most of the EV market, Tesla will take around 25%, that's 37.5 million. The number sounds crazy. I will dial it down to 10 million. I think Tesla selling 10 million a year by 2030 is very realistic.

 

[bonaire]

In the long term future, I think the world will maintain 1 billion vehicles, 50% privately owned, 50% shared. Private cars will have a life of 10 years, shared cars will have a life of 6 years. So the stable replacement rate will be ~132 million per year.

By 2030, buying a new autonomous EV will be more economical than maintaining an old ICE. Tesla buyers can buy a car and sign up to the Tesla Network, the real cost probably will be near zero. Assume all brands can do autonomous driving by 2030, the total demand should be very high, probably around 150 million a year.

I guess by then 4 companies will take most of the EV market, Tesla will take around 25%, that's 37.5 million. The number sounds crazy. I will dial it down to 10 million. I think Tesla selling 10 million a year by 2030 is very realistic.

Highest sales will be for sub-$10k vehicles in Asia (such as this), areas like India and China, where people moving "up" the economic ladder are reaching into lower-middle class. Batteries may be able to fuel such vehicles but most likely, high efficiency small engines. 2030 is early enough not to really announce the true end of oil even though it is running out as we continue to use it. Perhaps by 2050, legislators "really" tell people what is going on. But there will be an end to oil. But not by 2030. Autonomous may continue to be more vanity/luxury. The reason is the AV makers want to "cash out" on trying to sell huge value through an option - options must be priced at a profitable level and leveraged for what they do. If AV trucks displace $50,000+ annual salary truck drivers, that is the value. Not $8k for a car. So, the AV space truly is a jobs-killer and thus the real value to the AV companies is "what will labor-replacer companies pay for this on a base+subscription rate?" Many companies pushing AV are coming out of Silicon Valley or similar high-tech zones. They live to cash-out on high priced subscription models for software.

 

[ItsNotAboutTheMoney]

Bigger in numbers, but might depreciate in value. All depends on autonomy.

 

[ItsNotAboutTheMoney]

They have had the ability to rent cars for decades - as needed. What ride-share does is allows them to micro-rent. I was hoping Zip Car would take-off but it was not all that big a deal. Car share makes sense. People don't make sense, entirely.

Owning a car gives you the convenience of point-to-point travel at any time.

Zip Car allows for some cheaper rental by allowing pay-by-hour But it does not give you complete point-to-point travel. You have to pick up the car, and then get home after dropping the car off.

Autonomous vehicles would offer point-to-point travel.
Cheaper than a taxi.
More convenient than a rental.
By eliminating the need for a driver (taxis drivers and renters) they can become the same thing.

As for rural car ownership. It's big - people buy their $5k used cars that are 9-10 years old. They drive them for four-five years, scrap them and do it again. They let us "smart, rich people" buy new and enjoy the fast-deterioration of value through depreciation. So, who's really smart here? Insurance is cheaper, no need to keep it pretty and the cost to keep a car is quite low. The real problem is people who "must have" the latest car while stretching their budget to get into one. I met a lady once who worked as a secretary who was upside down in one car, traded it in on a Hyundai Santa Fe and owed $40,000 on that. Seriously, people make horrible decisions. Remember that half the population is below-average intelligence. This is the community that car-sharing must try to reach. How do we dumb down good ideas that will actually take-off? We dumbed down shopping (Walmart) pretty well. Add on Amazon to make it lazy (just order for your couch). Next step - full Wall-E experience of autonomous cars, car-share (remove people's independence) and what else comes after that?

Average price for retail used cars is $19k.
Average age is about 4 years. Lots of off-lease and ex-rental cars.
80% of US population live in urban areas.

Autonomous taxis would be an easy sell. Two key reasons:
1) You won't have to drive the car. Surf, read, text, relax, sleep.
2) Easy. App-driven. No test drives, no negotiation, no financing, no debt, no registration(, no property tax), no insurance, no inspection, no maintenance, no repair, no trade, no sale. Ride-share made simple: will take M minutes longer, will save you $D dollars, saving $H per hour.

And as skeptical as people are about how popular it would be, since we already have taxis, public transportation, rental and car pooling there are already easy ways into current markets. Beyond that, even those who aren't currently interested will encounter situations where it would be a natural option.

 

[bonaire]

How would Ride Share clear out Houston or New Orleans in the event of a Hurricane?

 

[RobStark]

Nationally, 26 percent of Americans described where they live as urban, 53 percent said suburban and 21 percent said rural. (This comes close to the census estimate that 81 percent of the population is urban if “urban” is understood to include suburban areas.)

How Suburban Are Big American Cities?

Urban and suburban is not the same thing.

 

[bonaire]

Suburbia is the sprawl that created the 1-car long-distance commuter. However, the average miles per driver day is about 40. 20-miles each way by a single occupant from home/work/home seems like it could be done better. Our first-world problem is the issue of why we must drive individually in our large automobile to our job when we could be using some sort of shared transportation. The fear of being with strangers (or even friends) keeps us from car-pooling and saving resources. Also, we demand convenience and this means the ability to leave work "in an emergency" or to rush off to some appointment with last-minute planning. We lose our first-world entitlements when we start adopting "ride-sharing". The first emergency someone experiences where they are held-up in getting somewhere because the ride-sharing network is down or cannot fulfill their needs is when things break down for each individual who starts to rely on it. But speaking of first-world - all the emerging markets want to be like us, like first-world. Individualism, entitlements and freedoms are greatly wanted by all populations.