Deloitte recently asked 1,000 Americans if they would be willing to give up car ownership in favor of something that they are calling "Mobility-as-a-Service." This umbrella moniker is meant to capture everything from public transit and bike shares to Ubers and car rentals.
Here are the results:
What's interesting is how willing young people seem to be to forgo car ownership. (Note: Willing, here, includes people who answered somewhat willing, willing, and very willing.)
It's also doesn't seem to be dependent on geography. Broadly speaking, urbanites are more likely to say that they would be willing to give up owning a car. In this survey, 50% of people in urban areas said that they would be at least somewhat willing, whereas the number drops to 17% for people in rural and suburban areas. But oddly enough, young people in rural and suburban areas are just as willing, if not more willing than their urban counterparts. I wonder why.
This maybe suggests that we are seeing a generational shift in how younger people view car ownership. That, or they haven't started having enough kids yet and their perspective will change as they get older. If I had to guess, I'd say it's a mix of both, but more of the former. Because look at the large spread between the next two cohorts in the above chart. There are some trends here (assuming this data is representative). It's not just about family life.
Also noteworthy is the fact that Canadians are some of the most unwilling people, according to this survey:
Personally, I hate driving. I look forward to the day when most cars drive themselves. So I'd place myself in the very willing camp. What about you?
We talk a lot about walkable urban communities on this blog, and I'll be the first to admit that this is my own bias. It's my preference. But at the same time, we can't ignore that, as of 2022, there were nearly 280 million registered personal and commercial vehicles in the United States. And that only about 8.3% of households do not have a vehicle. Most households drive in this part of the world.
The result is that lots of people want to regularly wash their car(s). According to Bloomberg, there are some 60,000 car washes across the US, and the overall sector has been growing at roughly 5% per year (I'm not sure over what time period). More thrilling, though, are the stats that the car wash market is expected to double by 2030 and that there were more car washes built in the last decade compared to all prior years combined.
The obvious reason for this is that there are a lot of drivers. But why right now? Apparently, there are other more specific reasons for the recent boom in car washes:
Now, washes can take just 90 seconds, labor costs have been automated down, and recurring revenue from memberships has eliminated weather risks. Plus, the tax reforms enacted in 2017 by former president Donald Trump allowed car wash owners to claim 100% depreciation on new equipment — a generous subsidy to further investment. While that incentive was written to shrink over time, the tax proposal currently in Congress would restore the 100% depreciation allowance.
This has the PE and real estate industries interested:
“If private equity thinks it’s sexy, they’re gonna throw money at it, right?” said Emil Khodorkovsky, founder and CEO of Forbix, a real estate firm that just acquired a car wash in Santa Monica, California. “It’s a basic business. It isn’t complicated finance. Certain actors are getting squeezed but this one still has a much higher-yielding return than an apartment building or a retail center.”
It's hard to think of a retail use that is more antithetical to walkable urban communities. Even most drive-through places have the ability to service things that aren't cars. It is also possible to go through a drive-through on a bicycle or other micro-mobility device. I have done this before and it was fun. But going through a car wash on a bicycle is probably a lot less fun.
Intuitively, as long as there are lots of cars, there will be lots of people who want car washes. At the same time, there may even be a more urban use case, here. If you happen to have a garage and a driveway, there is always the possibility that you could wash your own car. But if you live in a walkable urban center and you park your car in a stacker accessed via an elevator, it's probably a lot harder for you to do that.
In this case, there's a subscription for that.
The relationship between car ownership and urban density is a fairly intuitive one. Below are two charts from a study by Francis Ostermeijer, Hans Koster, Jos van Ommeren, and Victor Nielsen, showing how urban density is inversely correlated with car ownership. In other words, the more people with cars, the less dense that a particular place is likely to be.
But there's an interesting chicken-and-egg question here. Does Atlanta, which is near the bottom right in the above chart, have a lot of cars because it wasn't dense enough to support other modes of transport, or did the prevalence of cars in Atlanta cause the city to spread out and become less dense? And that is exactly what the above researchers set out to determine.
To do this, they started by looking at the presence of commercial car manufacturers in the above geographies in the 1920s. One of the things they found was that having a car manufacturer in your city at this time appears to have had no effect on population density. But over the long run, rising car ownership seems to have had a sizeable effect on reducing population densities in those places.
The conclusion they draw from this is the title of this post: cars have made cities less compact, rather than low population densities causing people to go out and buy more cars. This makes some sense to me because cities were doing just fine before we invented cars. But like all transportation innovations that allow us to move faster over longer distances, the car encouraged decentralization.
There are, of course, all sorts of possible implications for a finding like this. But the authors specifically mention developing countries where car ownership may still be relatively low. This is something to be mindful of because if you put most people into cars, history strongly suggests that it will impact the kind of city that you end up building.
