In a recent study published by KPMG states that by 2030, autonomous rideshare cars will reduce the demand for self-owned sedans by 50%. The study performed by KPMG, which is a professional service company and one of the Big Four auditors also stated that families in the US would prefer owning larger vehicles than smaller sedans. The study was based on cellphone data collected from trips taken in Los Angeles, Atlanta, and Chicago. The Chicago trips were the shortest, ranging 15 minutes, the Atlanta trips showed that most trips were between suburbs and not with the city center and the Los Angeles trips were the longest, averaging 90 minutes or more.
Based on many consumer preference reports and technological studies, most automotive industries in the US are starting to retool and plan for larger car models such as SUV and minivan production while reducing the lines for smaller cars.
The report states that they used cellphone data to map Uber rides in three of the US's major cities and forecast that all rideshare companies and automotive sales offices will concentrate their sales in major urban area's that they term "island markets." These markets will cause families to abandon owning their own cars, or to buy one larger family SUV, and prefer to use rideshare vehicles for daily trips. This decline in sales will lead the sedan market to drop from 5.4 million cars sold annually to 2.1 million cars only.
One large automotive manufacturer, Fiat Chrysler has already stopped producing small and midsize sedans in the US, and according to the report, the number of producers will drop from 10 to 3. The KPMG study was released with the start of the Los Angeles Auto Show, and many automotive technology executives agree that the autonomous car market will start with rideshare companies and ripple out to self-ownership. General Motors is very active in this market and works together with Lyft, investing over $1 billion in the company and providing an AV platform for Lyft to test.
Waymo, Alphabets venture, which is currently in a court case against Uber over stolen information is now testing its vehicles on some US roads, while Uber has signed a major contract with Volvo to supply 24,000 vehicles for their AV venture and hope to finalize the SoftBank investment which is aimed mainly at financing the Uber AV project.
Our take: Once self-driving cars become abundant on the market, the focus on comfort and energy conservation will overtake speed and power, and smaller sports models will remain the domain of private ownership but will slowly be regulated, in order to protect the larger autonomous driven car market from human error. While the changes reported by KPMG will come into effect slowly, the actual market will not change its entire face until the entire traffic grid has become the sole property of autonomous vehicles. Once this becomes the case, then a human error on the roads will be eradicated, and the number of accidents will reduce. This will in effect change many key income sources, and effectively change the world economy. These areas are car insurance, traffic and driving law enforcement and healthcare. The sectors that will increase will be the maintenance of roads, traffic technology, and auto mechanics adding an electronics and software maintenance function into their services.