The Unsettled World of the Automobile

Ride-sharing and car-sharing are complicating life for transportation planners, not to mention automakers.
March 22, 2016
By Bob Graves  |  Contributor
Associate director of the Governing Institute and a co-founder of Governing's parent organization, e.Republic

Planning for transportation and other infrastructure needs isn't easy under the best of circumstances. When you add in the escalating influence of smart technologies, it becomes even harder, so it's no surprise that 78 cities vied for funding in the federal government's transportation-focused "Smart City Challenge." For transportation planners, an increasingly important piece of the long-range-planning puzzle is the impact of ride-sharing and car-sharing services.

Research shows that car-sharing provides numerous benefits to communities. A report from Mobility Lab, an Arlington, Va.-based research organization, describes advantages including reducing household car ownership and vehicle miles traveled, alleviating parking and traffic congestion, and increasing public transportation use. Todd Litman, founder of the Victoria Transport Policy Institute in Canada, found that car-sharing can reduce average vehicle use by as much as 60 percent.

Information like this makes it easier to embrace smart transportation technologies. But announcements from auto manufacturers, a car-sharing company and Kelley Blue Book highlight just how confounding it is becoming to predict future use patterns of these types of technology.

A Kelley Blue Book-sponsored survey of more than 1,900 U.S. residents found that while 73 percent were aware of ride-sharing, only 16 percent had actually used those services. As for car-sharing services, the survey found that while 43 percent were aware of them, only 7 percent had used them. Kelley Blue Book's takeaway was that ride-sharing and car-sharing are not imminent threats to new car buying and vehicle ownership. "Our data reveals that owning a car still reigns supreme, with reliability, safety and convenience all being major factors," said Karl Brauer, a senior analyst for the company.

Nevertheless, car manufacturers don't seem completely confident that individual car ownership will continue to be the dominant mobility model. In January, General Motors announced a $500 million investment in the ride-sharing company Lyft and launched a car-sharing program called Maven. Just last week, GM and Lyft said they were launching a short-term car rental program aimed at prospective Lyft drivers who don't have qualifying cars. And Ford recently announced a pilot program that will offer vehicle leases to self-organized groups of three to six people. Initially available at only three Austin, Texas, dealerships, this model fits midway between car-sharing and full personal car ownership.

 

Then, in February, Daimler AG's car-sharing company Car2Go reported that the Canadian city of Vancouver was the first city in the world to exceed 100,000 members. One-sixth of the British Columbia city's residents are Car2Go members. With over a million members worldwide and a presence in some 60 cities, Car2Go has shown car-sharing to be a popular service for urbanites. But even in the car-sharing hotbed of Vancouver, Car2Go has dealt with wide variations in membership and use. In the less densely populated suburban areas just outside of the city, Car2Go and other car-sharing companies have seen memberships drop significantly to a fraction of the downtown numbers.

Marc-David Seidel, a professor at the University of British Columbia's Sauder School of Business, offered some insight on where car-sharing might -- and might not -- work. "While car-sharing can be good for the public," he says, "it's not a public service, and it's hard for car-sharing companies to turn a profit in lower-density cities, even if those cities have pockets of high density."

Clearly, the world of the automobile is changing in ways that could not have been foreseen just a few years ago. Automakers, along with the car-sharing and ride-sharing upstarts of the industry, are all scrambling to find their places in this evolving landscape. When it comes to long-range planning and investment decisions, for local officials and transportation planners alike it may be even more important than ever to research and understand local residents' attitudes, interests and needs.