University of Michigan: American Car Ownership Falls

Car ownership may have finally peaked, study reveals.

Americas love affair with cars remains, but it isnt as strong as it once was. Research conducted by the University of Michigan Research Transportation Institute (UMTRI) has found that the number of US households doing without a car has fallen in each year since 2007. The study comes on the heels of earlier UMTRI research that revealed Americans own fewer light-duty vehicles, are driving them less, but also consuming less fuel.

At the Wheel.
The number of homes without a car is on the rise.

Falling Car Ownership Rates

UMTRI took a look at a trend spanning from 2005 to 2012, noting near-consistent slippage in the number of US households owning light-duty vehicles (LDVs) beginning in 2007. LDVs compose cars, minivans, sport utility vehicles, and pickup trucks. Of the 30 largest US cities, 21 saw an increase in the number of households not owning a car, including the top 13 cities.

The proportion of households without a vehicle is likely influenced by a variety of factors, said Michael Sivak, a research professor at U-M. Examples of such factors include the quality of public transportation, urban layout and walkability, availability and cost of parking, income and price of fuel.

Urban Residents and Car Ownership

New York City has long led the list with the number of households not having a vehicle, coming in at 56 percent in 2012. Seven more cities have at least a quarter of households without a vehicle including Washington, DC, at 38 percent, Philadelphia at 33 percent, and Detroit at 26 percent.

Each city is located in the congested northeast or upper midwest corridors, with the exception of San Francisco. At 31 percent, San Francisco’s rate matched Baltimore, trailed Boston’s 37 percent and was ahead of Chicago’s 28 percent.

The Cost of Car Ownership

Analysts have been looking at the cost of car ownership for many years, a factor that can also contribute to the fall in car ownership. Indeed, in 2012 Consumer Reports (CR) found that over the first five years of a median cars ownership, it costs more than $9,100 per year to own one. Cars such as a Mini Cooper averaged $5,800 per year while large SUVs cost $13,000 or more per year to own.

In its survey, CR looked at six categories of car ownership led by depreciation representing 48 percent of ownership costs followed by fuel at 24 percent. Interest on loans at 11 percent and insurance at 10 percent followed. Taxes, as well as maintenance and repairs, accounted for 4 percent each.

CR also looked at one- and eight-year owner costs to show a drop in those costs over time. However, depreciation remains the largest cost throughout, accounting for 57 percent for the first year, gradually falling to 43 percent for the eighth year.

Desiring Affordable Transportation

Americas love affair with cars has long been based on affordable transportation. With the economy struggling to find footing and with consumers seeking to contain costs, the trend toward fewer vehicles on the road seems assured. That some households are doing without a car at all usually points to urban living where car ownership is as much as a hassle as it is a significant cost.

Notably, what often isn’t included in these reports is consumers attitude towards car sharing. This is an option that allows people to use a car for as long as they need it, from just a few hours to a few days. Thus, people have access to a vehicle without the burden of car ownership and of parking as is the case for city dwellers.

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Author: Matthew Keegan
Matt Keegan has maintained his love for cars ever since his father taught him kicking tires can be one way to uncover a problem with a vehicle’s suspension system. He since moved on to learn a few things about coefficient of drag, G-forces, toe-heel shifting, and how to work the crazy infotainment system in some random weekly driver. Matt is a member of the Washington Automotive Press Association and is a contributor to various print and online media sources.

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