Uber, Zipcar and other ride-sharing services likely to take a bite out of car sales, study finds

As traditional automakers scramble to invest in ride-hailing and car-sharing services, a new study shows that they’re probably likely to end up cannibalizing their very own customers.

The American Public transit Association (APTA) surveyed more than 4,500 users of shared mobility in seven U.S. cities and found that people who use services like Uber, Lyft and Zipcar are significantly less prone to buy a car and, when they do, tend to own fewer cars than those that do not.

David Plouffe, chief advisor at Uber Technologies Inc., said the most notable change in habits is one kind of younger individuals who just don’t put the same importance on having a car as their parents did.

“When I had been 15 or 16, all of your life revolved around saving money to purchase an automobile, your whole dating life revolved around the car,” Plouffe, who also managed Barack Obama’s 2008 election campaign, told a press briefing Tuesday.

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“That is evolving. Young people wish to reside in cities at a pace and rate we’ve never seen before as well as their inclination is, if one makes simple to use for them to circumvent the town, they’d rather not purchase cars.”

This is reflected within the data in the APTA survey. When asked how their finances had changed given that they started using shared types of transportation, 20 per cent of respondents said they postponed purchasing a car, 18 per cent didn’t get one whatsoever, and 21 percent sold their car and didn’t change it.



In addition, laptop computer found that individuals who use shared modes of transportation own typically 1.05 cars per household versus 1.5 cars for individuals who don’t. “Supersharers,” defined as people who routinely use several shared modes of transportation – including bike-sharing, car-sharing services like Zipcar, and ride-hailing services like Uber and Lyft – own an average of just 0.72 cars per household.

Despite the survey’s findings, North American auto sales have shown no manifestation of reducing yet. U.S. vehicle sales hit an archive high of 17.5 million in 2015, while Canadian auto sales rose to a third consecutive record of just one.9 million.

“All of our services need to band together, we’re allies,” Emily Castor, director of transportation at Lyft Inc., told the press briefing.

“Together we are able to have a catalytic impact for making it possible for people to not need to own cars. – Whenever you reach that tipping reason for 3 or more shared modes that someone uses, that’s when they get rid of the vehicle, and that’s the robust ecosystem that’s starting now to develop in major cities.”

It’s also an ecosystem that automakers are jostling to get into, despite fears that it could eat into their main business of selling cars.

General Motors Co. invested US$500 million in Lyft earlier this year and announced Tuesday that it will book cars to Lyft drivers for US$99 each week. If the driver gives 65 or even more rides per week, the rental is free of charge.

Last week, Ford Motor Co. said it plans to establish a subsidiary in Palo Alto, Calif., which will focus on developing new forms of mobility including car-sharing and ride-hailing services.

BMW AG, meanwhile, is also reportedly thinking of expanding its car-sharing service to provide a ride-hailing service, according to Germany’s Spiegel Online.