AD #1964 – Mobility’s Impact on Car Sales? BMW Shows Vision for Future Motorcycle, A Look at Toyota’s New Plug-In

October 12th, 2016 at 11:54am

Runtime: 7:42

To watch this episode on YouTube click here.

- Toyota & Suzuki in Talks to Collaborate
- What Will be Mobility’s Impact on Sales?
- Samsung & Magneti Marelli Deal Going Down in Flames
- BMW Shows Motorrad VISION NEXT 100
- A Look at Toyota’s New Plug-In, the Prime

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26 Comments to “AD #1964 – Mobility’s Impact on Car Sales? BMW Shows Vision for Future Motorcycle, A Look at Toyota’s New Plug-In”

  1. Cozy Cole Says:

    Hello Sean, Mobility, well do you ever look at the people in the mobility adds. They r not even close to my age and probably most of your listeners. we would have a very skewed outlook. But I look forward to the day when maybe I cannot drive anymore to summon my mobility module and travel somewhere. It will be a long time before the mobility modules cut deeply into auto manufacturing. the over 50 crowd likes to own and drive their cars!

  2. David Sprowl Says:

    What will mobility do to car sales? That question has multiple factors some of which has yet to so a clear trend. If inner cities pack in more population, then some from of servicing will have a place. Urban planning is a factor in this. If suburban dwelling remains one possibility is that cars used in ride sharing will become the corporate off lease car of the future. If banking comes up with another from of financing, then who knows. If income should rise (least likely) then it is likely little will change. Way too many variables to accurately predict.

  3. Mark Says:

    What will autonomous cars do to car sales?

    For those that use autonomous cars AND use shared cars, there will be more driving, but we’ll need a lot less cars to do driving.

    I think the percentage of people comfortable with sharing a vehicle (and dealing with the headaches that come from that like messes left behind by previous drivers) will be less than some optimists think.

  4. Kit Gerhart Says:

    At some point, in the future, “mobility” will greatly decrease the number of cars sold. For a start, there will be fewer people like myself, who have multiple cars, just because they like cars.

    More directly related to “mobility,” the cars will have miles put on them quickly, run to very high mileage, and will be worn out before being scrapped. Now, many of the cars in such places as Indiana and Michigan are scrapped because the road salt destroys the body, not because they are actually worn out. The “mobility” vehicles will accrue miles quickly enough that they will wear out, and be scrapped at much higher mileage, on average, so there won’t be a need for as many new cars.

    Yeah, this is just my thought.

  5. G.A.Branigan Says:

    ” mobility services” won’t mean a thing to those that live and work out in the country.Will it make a difference to city dwellers? Sure it will,but it don’t mean nuthin to us country folk.

  6. Sean McElroy Says:

    @Cozy Cole – I think you’re on to something with mobility ads. It would be nice to see all the different types of people that mobility can benefit in these ads, like elderly, blind, disabled or whatever. But like so many other ads from all sorts of industries, they go for young and “good” looking.

    Also, the over 50 crowd are not the only people that like to drive. I think most millennials do as well. It comes down to how important it is to them. The cost of car ownership these days prices many people right out of the market. Even used car prices are quite high. With so many different ways to get around that are well priced, I think many younger people are skipping the thousands of dollars it costs to purchase, maintain and fuel a vehicle.

  7. Sean McElroy Says:

    @David Sprowl – Accuracy be damned. This is just meant to be a fun exercise. I’m willing to bet you lean a little further one way than the other. Even if it’s 51% to 49%.

  8. Craig Says:

    To answer your question John, the characteristics of the mobile public should be considered. There are groups of people who:
    - require shared transport due to health or finances
    - can be swayed to car/ride-sharing given the right circumstances
    - prioritize the freedom of personally owning a vehicle above all else

    These groups exist in varying percentages, depending on population size/density, which also adjust depending on time of day and social circumstances, such as work commutes or sporting events.

    To answer your question, there is an inherent cap that has existed prior to the latest car/ride-sharing movement. Despite HOV lanes, public transport, and whatnot, the majority of the public insists on commuting in their own vehicle and often by themselves. This majority faction has proven to be resistent to alternative measures by government and economic factors.

    While the success of Uber, Lyft, and the rest might suggest otherwise, they are only slightly shifting the percentages around of the categories mentioned above, moving people from cabs to Uber or transit to Lyft, or pulling small factions of people who feel commuting is mostly an inconvenience and are merely being swayed by the newly-offered convenience. This will plateau sooner than the pro-sharing fanatics care to admit.

    At any rate, a relatively small shift to sharing will exist. My assumption is that car sales will remain surprisingly similar, as the shift of fewer car owners will be matched by higher vehicle consumption of the “sharing” market. This is, of course, assuming that governments continue to fund public transit at current levels and don’t shift their focus to a ride-sharing model, which I would deem unlikely.

  9. JWH Says:

    Mobility vs Vehicle sales – Believe it will eventually reduce vehicle sales slightly, compared to without mobility, since if the system works correctly each vehicle in the mobility system will have higher usage rates. I do not believe my habits (4 vehicles that total less than 15,000 miles/year) will have any impact on sales volumes changed by mobility.

  10. BobD Says:

    A few point on mobility…

    1) As other have said, this is mostly going to be an urban impact, so in the US, most car owners will not participate in ride sharing, so the impact on auto production will be minimized.

    2) Unless total miles driven decreases, ride sharing will not decrease auto sales. It just means you wear the shared cars out faster and have to replace them more often, so the average life of a car might drop from 11 years to 4 years, or if shared vehicles are swapped out before being worn out, you will have a used car market for two year old cars with 150,000 miles on them.

    3) Shared rides and autonomous (driverless) cars could reduce the urban transportation costs down to the point where many cities might abandon their traditional bus systems and find it cheaper to subsidize mobility services for those who currently depend upon mass-transit. This would actually increase the demand for cars (at the expense of a decrease in building buses).

  11. Rick S Says:

    Mobility services will reduce ownership numbers but it comes down to 2 simple things. How long will cars last and how many miles are driven (irrespective of ownership status). Car aren’t likely to last a whole lot longer in the future, so it comes down to miles driven. If that remains the same, vehicle production should remain the same. Shared vehicles will accumulate miles faster and get replaced sooner. Autonomy is another matter and one likely to increase miles driven by reducing accidents (and insurance costs). Lower costs will lead to more miles driven. A single car could take two people to and from work in different places, but the car driving itself with no one aboard will lead to far more miles being driven and more cars needed. Trips could become cheaper and easier when one can sleep during the drive under lower insurance costs and perhaps lower vehicle costs as crash requirements could go away if autonomy leads to very few crashes.

  12. Lisk Says:

    We already have mobility services. They are called taxis and buses. I don’t think you will see a sales slump. People that provide those services are going to need a car, and with the advent of Uber, Lyft, etc., I think even a greater number of cars will be needed if these services replace the taxis as I’m not sure if mobility services will run individual cars 24/7.
    I’m curious as to the length of time a Uber/Lyft driver sticks with the job before they decide it’s not worth it?

  13. Dave Forslund Says:

    Mobility’s impact on sales:
    The impact will be a net “0.”

    In highly concentrated population areas, the impact will not be in number of vehicles, but in ownership.

    Today, many young and old city-people do not own cars but use rentals or taxis as needed. These people will benefit from new mobility possibilities at the expense of rental and taxi owners. If population remains constant, car usage will remain constant, or slightly increased due to convenience.

    In less populated areas mobility will have little impact, since people like their independence, the convenience of ownership and have land to park and store the car when not in use.

    This trend has been evident for the past years, as large downtown-city auto dealers have vacated the market due to fewer buyers and high costs.

  14. Kit Gerhart Says:

    9 If the average car is scrapped at 500K miles, rather than 200K miles, won’t that decrease auto sales?

    Also, the world is becoming more urban, and at some point, even the U.S. might begin to have better mass transit, which is much more efficient than cities full of cars, autonomous or otherwise. If things go the other direction, yeah, more cars will be used in cities, but that seems unlikely to me.

    I am mostly speculating about 15 or more years into the future, when there will be fewer people like JWH and myself who have four cars, driven a total mileage of less than a quarter of what these shared cars will be driven.

  15. Bob Gurr Says:

    Current mobility proposals are very urban density driven. But such a large proportion of the US driving environment is open space states, I suspect these area, such as Utah, will see very little change from the existing necessity of long distances and hauling life goods (pick up trucks).

    While a slight overall drop in annual vehicle manufacturing might happen, total annual vehicle deliveries will be far more influenced by the inescapable future economic downturns/recoveries and actual annual family incomes.

  16. Chuck Grenci Says:

    I will go so far as calling that BMW ‘thingy’ a two wheeled vehicle, but calling it a motorcycle; ain’t gonna happen (in my life time); you don’t call a Segway a motorcycle, do you? If ever produced, it may sell some units, but riding a motorcycle is a lot more visceral for the majority of riders.

    And on mobility transport: depending on the popularity and acceptability of ride-share scenarios, whether it makes a small or major impact, the acceptance will be gradual enough that the manufacturers will have plenty of time to adjust (production, if needed).

  17. Marshall Says:

    As someone who owns a Suzuki SX4 (don’t laugh) I still feel burned by Suzuki’s exit from the USA market. Getting serviced is a PIA.

  18. Len Simpson Says:

    Toyota needs to quit messing w/hybrids & perfect this avenue of their endeavors “Kiss” personified http://www.tytlabs.com/tech/fpeg/fpeg02.html

  19. Drew Says:

    Shame on you, BMW. I admit I appreciate seeing a pretty girl on the concept motorcycle, but she should be wearing a helmet. I recognize BMW claims the bike has new safety technology, but we still fasten our seat belts when in passenger cars with ADAS technology.kewise, motorcyclists (and I am one) should always wear a helmet.

  20. Drew Says:

    As our infrastructure is not expanding to accommodate more vehicles, we will be facing urban limits on personal vehicle use. So, mobility services will expand from elderly and handicap customers to urban customers (parking and other fees will become very burdensome to vehicle owners). It has already modified my Driver patterns (I refuse to visit socialist domains such NYC, Chicago, etc.).

    Ultimately, new vehicle sales will ebb as a result of multiple attacks – mobility services, government policies that punish perusal use, longer designed-in vehicle life (resulting from electrification and less-corrosive light weight body materials), and substantially higher prices due to all the autonomous sensors and fuel efficiency technologies.

  21. FSTFWRD Says:

    I think car sales will stay the same for quite some time. Yes, maybe fewer cars sold at one moment, but if they do get shared they will rack up many miles and have to be replaced sooner. (Yes, others have made this point) But I’m not so sure too many people will share their ride because these cars will all be in demand at the same time, and I think many commuters will be reluctant to give up their personal freedom, like running other errands on the way home from work, or stopping for Starbucks on their way to work.
    I too am one who owns 4 cars with only two drivers, just because I like cars. Yes, I do realize the younger people will not think this way, but it will take some time for us to phase out.
    I certainly agree with the comment about too many variables at this point to make an accurate prediction,

  22. Kit Gerhart Says:

    18 While I visit there occasionally, I certainly would not drive in the “socialist domain,” as you call it, of NYC, one of the few U.S. cities with very good alternatives to driving. Where I live, there are no subways, limited bus service, basically, no good alternatives to driving.

  23. Roger T Says:

    Great point kit (#20). People assume population will continue to migrate to cities as time goes by, that’s actually reasonable.
    If this happens (only if), many people will not own cars, but those cars that are around will drive more daily miles. That’s not only because they will be used more efficiently, but also because between rides they will be driving empty to pick passengers up. An important bottleneck is for instance rush hour – what happens when everyone needs a ride at same time? How about a hurricane evacuation scenario?

  24. David Sprowl Says:

    @Sean McElroy. You’d loose the bet. To sum up my answer, “We’ll see.” Are we counting sales by raw units sold? Per population?, by WHO owns the cars, public/corporate vs private ownership?

  25. Lex Says:

    Car Sharing and Mobility will increase the sale of compact CUV’s and sedans with abundant interior space like the Chevy Bolt. It is probably the best example of where the future of the automotive industry is going as it relates to Mobility and Car Sharing.

    I can see the fully electric Bolt for inner city car sharing. The bolt would be dropped off at a charging station once current user is finished. The Bolt then can beginning the recharging process waiting for the next driver. A totally electric vehicle makes the most sense since their is little maintenance needed to keep it on the road. Their will need to be more frequent inspections or a passenger compartment camera installed to prevent vandalism to the vehicle.

    The wear out rate of EV’s still needs to be measured but realistically only the battery packs will need to be swapped out after some many 100′s of thousands of miles. The Chevy Bolt and like vehicles could be the 21st Century equivalent of the Marathon Yellow Cab which serviced major inner cities several decades ago.

    So to answer your question: Yes I believe that there will be an increase in the demand of compact EV’s like the Chevy Bolt from ride sharing companies. These vehicle will need to be sub $30-35K in cost per unit. The population of the world is increasing and the demand for personal mobility will continue to increase. The EV will gain a greater share of the OEMs output in the decades to come to comply and meet governmental environmental regulations.

  26. Jim Foley Says:

    At the North Carolina Art Museum there is an exhibit of Art Deco cars which included a 1934 BMW Concept Motorcycle. I was struck by how similar this looks to the current concept – although everything has changed.
    Go to http://ncartmuseum.org/exhibitions/archive/rollingsculpture and see for your self.