New forms of mobility are expected to drive a sharp decline in personal vehicle ownership over the next five years, according to a 2018 Cox Automotive Evolution of Mobility Study: A Dealer’s Perspective.
The report, the last chapter of a three-part series, is based on an online survey that included 430 franchise and independent automotive dealers in the U.S. The study suggests that dealers, more than consumers, are predicting a more significant decrease in car ownership during this timeframe — with one in 10 viewing mobility as a threat to their business.
“Dealers are approaching the evolving mobility landscape with their eyes wide open,” said Joe George, President of Cox Automotive Mobility. “While traditional car ownership isn’t going away anytime soon, we’re focused on enabling dealers with innovative consumer mobility and shared fleet service solutions to keep their businesses relevant.”
Strong growth has also been predicted for alternatives to traditional vehicle ownership: within the next 10 years, 47 percent of dealers “see consumers owning or leasing fewer vehicles per household as a direct result of the increasing number of mobility options and the introduction of autonomous vehicles to the mass market,” said Kelley Blue Book in a news release.
Dealers (87 per cent) expect ride-hailing services to demonstrate the most growth, followed by car subscriptions (82 per cent), car-sharing (81 per cent) and self-driving cars (81 per cent).
While some dealers view these services as a threat to their current retail business, 47 per cent also view them as possible new revenue streams. Forty per cent see it as a way to reach a new consumer base. Furthermore, 59 per cent of dealers believe fixed operations will play a more important role with the vehicles used for services like ride-hailing and car-sharing. The expectation is that these vehicles will log more miles and require more service.
“Any hesitancies by the dealers surveyed toward these new mobility solutions are due to the uncertainty surrounding operations rather than rejection of the models themselves,” said KBB. “This includes knowledge of how to set these services up, outside support to get these services off the ground and the overall cost benefit.”
The shift away from traditional auto retail stores is not expected to result in the end of the dealership model. That being said, 57 per cent of dealers predict the need for fewer dealerships within the next decade.
