What’s the Impact of Ride Sharing and Car Sharing on the Automotive Industry


With Uber, Lyft, and other ride and car sharing platforms becoming commonplace in modern society, where does that leave the age old tradition of owning a car?

Car ownership has always been somewhat of a right of passage into adulthood. In order to drive a car, you have to have a driver’s license. The problem is, people just aren’t interested in getting them anymore. In fact, a study from the University of Michigan Transportation Research Institute found that the percentage of people with driver’s licenses is decreasing across all age groups. The drop is even more stark for younger generations with only 24.5 percent of 16-year-olds having a driver’s license in 2014. This is a 47 percent drop from 1983. So, is this lack of desire to be able to drive caused by the lack of need for car ownership? Well, maybe.

While this downward trend in licensed drivers continues, a study from Technalysis found that most of the U.S. population still has absolutely no experience ever using a ridesharing service. Of all of the people surveyed only 20% said they use a ridesharing service on a regular basis. 20 percent is still a significant number, but it doesn’t seem to account for the dramatic drop in license procurement. Digging deeper into that study, of the 20 percent that said they use ridesharing regularly, 75 percent said that it is only supplemental to their own personal driving. Maybe car manufacturers are safe?

This data demonstrating that most don’t view car sharing as the end for the need of car ownership is backed up by further independent studies. The Center of Automotive Research concluded that all ridesharing and carsharing services combined will only account for 15,163 fewer car sales in North America – or .08% of the total yearly market. So, it seems that these services are affecting the automotive industry, but very minimally. Even with these small drops in sales, the Automotive manufacturers are still profiting.

Most manufacturers recognize that the industry isn’t static. Ford is investing in a fractional ownership car program. General Motors invested $500 million in Lyft last year. Major manufacturers are innovating and investing. This means that as ridesharing grows, so do the profits and success of major car manufacturers.

But, what does this all mean for the future of car ownership? Owning a car will hardly become taboo in the next 15 to 20 years. It is still a large part of the global economy, and changing an aspect so central to global growth takes time. Studies predict that carsharing and ridesharing services’ market share will continue to grow, but not to a point that will heavily disrupt the innovating automotive industry. The decreasing trend in driver’s licenses, however, may continue – but not because of ridesharing. Self-driving cars will likely bring an end to the need for knowing how to drive a car. Even with that said, any change coming will be slow and steady. Industries will adapt and economies will shift. The future looks bright for automotive manufacturing and the industry as a whole.

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Trevor is a civil engineer by trade and an accomplished internet blogger with a passion for inspiring everyone with new and exciting technologies.


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