(John Kemp is a Reuters market analyst. The views expressed are
By John Kemp
LONDON Jan 20 Car use appears to have levelled
off and even started falling in many of the world's advanced
economies long before the global downturn in 2008, according to
The slowdown brings to an end several decades in which car
use grew roughly twice as fast as real GDP and incomes.
The trend is consistent across the United States, Britain,
France, Japan, Italy, Belgium, Germany, Sweden, the Netherlands
and even Australia.
Plateauing car use in much of North America, Western Europe
and developed Asia leaves the future of oil demand dependent on
motorists in emerging markets.
"The economic recession and relatively high fuel prices
explain part of the decline in the growth of travel but not all
of it," according to the OECD's International Transport Forum
(ITF) in a report on "Long Run Trends in Car Use".
The reasons are complex and may vary from country to
country. There is still considerable uncertainty about why car
use among young adults is falling so rapidly, and whether it
represents a voluntary change in lifestyle, a response to tough
economic conditions, or the increased availability of
alternatives such as public transport and the Internet.
"Slowing population growth, population ageing and increasing
urbanisation contribute to the change in passenger use in
several countries," according to the forum. "There is evidence
that car use has also been reduced through policy intervention,
particularly in urban areas."
The downturn is not even. "Car use ... among young adults
(men in particular) has declined in several countries in recent
years," the ITF added in the report published last year.
Mobility may also be declining across other modes of
transport as well.
In 2012, the average person in Britain travelled 6,691
miles, 4 percent lower than the annual average between 1995 and
1997, according to Britain's Department of Transport ("National
Travel Survey 2012").
The number of trips by private transport was down by 14
percent, while the number by some form of public transport was
up 2 percent.
FUEL PRICES, INTERNET
Fuel costs are clearly a factor in many countries. Crude oil
prices have quadrupled since the turn of the century. The rise
in pump prices for gasoline and diesel has been proportionately
smaller because of taxes. Nonetheless, driving has become
significantly more expensive.
Unsurprisingly, as travel becomes more expensive, households
are travelling less and choosing more efficient modes of
transport. Something similar was observed in the 1970s and early
1980s in response to the first two oil shocks.
Demographics also play a part. Annual miles driven decline
by around half when an individual retires. As populations of
advanced economies grow older, per capita car use is falling.
But driving is also responding to other more complex social
changes. The rise of mobile computing, smartphones, more
single-person households, the trend to start families later,
more young people living in central urban areas and "changing
images of contemporary life" could all be reducing car use,
according to Phil Goodwin at the University of the West of
England's Centre for Transport and Society.
He thinks some of the social status and self-identification
invested in the car has been transferred to the smartphone. "I
love my car" has become "I love my smartphone," Goodwin argued
in a thoughtful 2012 conference paper entitled "Peak car. Where
did the idea come from? And where is it going?"
Certainly the rise of online shopping and social networking
may have replaced some shopping trips and leisure travel.
"Survey evidence supports the view that technology and social
media are seen as substitutes for physical travel, particularly
among the young," according to the ITF.
"The largest decline in car travel is for shopping and
visiting friends and relatives," it says, "which some see
suggestive of a change induced by choice (perhaps facilitated by
the rising availability of online alternatives to travel) but
which could also be the result of tighter budget constraints".
COMPANY CARS, YOUNG MEN
The downturn in driving is not uniform and is heavily
concentrated in certain social groups. In Britain, for example,
the downturn has been sharpest in London, where the high cost of
insurance and parking, as well as congestion charging and a
dense public transport network have all combined to reduce
driving since around 2000.
In the mid-1990s, cars accounted for 50 percent of all
journeys within the capital but that has now fallen to less than
40 percent, said David Metz at University College London's
Centre for Transport Studies ("The future of the car").
In Britain as a whole, the driving downturn since 1997 is
entirely explained by less driving among males aged under 50.
For men aged between 30 and 50, declining company car use
can explain the entire levelling off in driving since the 1990s,
said the ITF, which attributes it to less-favourable fiscal
treatment for fuel used in company-owned vehicles.
For younger men, aged 20 to 29, access to company cars is
limited and most of the decline is down to less use of private
vehicles. Their car travel has declined by a massive 1,800 miles
per year each on average since 1997.
"Half of the decline (among young males) is due to fewer
people driving, and half to reduced mileage by drivers. About
one-third of the decline is for trips to visit friends and
relatives," ITF says.
It remains unclear how much of this downturn is the result
of a positive choice to adopt a different lifestyle, and how
much is being compelled by increasing economic hardship and the
costs of owning and running a car.
But the downturn in London and among company car owners
suggest deliberate policy choices, such as congestion charging
and increasing fuel taxes, can have a large impact.
The fact the downturn began long before the recession in at
least some of the advanced economies suggests there has been a
structural break in driving behaviour. If true, driving growth
will not revert to its previous long-term trend (growing twice
as fast as GDP).
In developing economies, however, car use will continue to
rise. "The rule of thumb that mobility and in particular car use
will develop in line with GDP as long as policies do not point
strongly in the opposite direction, remains broadly applicable,"
according to the ITF.
"Population growth and rural migration to the cities where
motorisation is often twice that of rural areas due to higher
incomes, will induce pressure towards greater mobilisation," the
Deliberate transport policies "could induce levelling off of
car use at lower per capita use volumes than are observed in
currently high-income countries," it said. But it will take more
than just providing cheap and reliable public transport. As the
example of the advanced economies shows, policymakers would need
to adopt policies that deter car use.
(The author would like to thank several of those who
commented on FTAlphaville's post on "Peak car?" Jan 17, 2014,
for some of the references used in this article)
(Editing by Pravin Char)