Expect Fewer Two Car Households In The Future

The percentage of two car households in America is expected to fall from 57% today to 43% by 2039, according to consulting firm KPMG. Its projections for the future were released Tuesday as part of the Connected Car Expo at the Los Angeles Auto Show. Gary Silberg, KPMG’s automotive sector lead partner says, ” If that happens, the overall number of cars in America will actually decline. The industry economics would look fundamentally different than they do today.”

Part of the reason for the predicted shift in car ownership habits is because more Americans are electing to leave suburbia and return to urban life. Living in the city means access to public transportation and the ability to walk or bike to work. It also means finding places to park two cars is more of a challenge. KPMG says it costs about 61 cents per mile to own a car today. Getting rid of one car can slash how much American families pay every year for car insurance, maintenance, taxes, and fuel to the tune of $10,000 per year or more.

Another factor identified by the study is the rise of internet-powered car sharing platforms like Uber and Lyft. “The economics of mobility on demand are powerful,” Silberg says. Basically, why bother owning a car if you can have all the benefits with none of the drawbacks?

The percentage of two car families is already below 50-percent in several major US markets. New York City households are the least likely to own two cars, but even in car-friendly cities like Los Angeles and Houston, the percentages have dropped. In Los Angeles, 47.8 percent of households claim two or more vehicles and in Houston, it’s 47.1 percent, according to 2013 US Census Bureau data.

KPMG is advising auto companies that the rise of computer-based ride sharing will have a significant impact on the auto business. But the company is also telling its clients that they can hold onto customers by enhancing their connected driving experience. In other words, the ability to interface with work, family and friends while in the car will be a central consideration for car buyers in the future.

Source: Autoblog | Image: Iriana Shiyan / Shutterstock