Study Finds Consumers Prefer Flexibility of Car Ownership
If it seems like conventional wisdom is predicting that the U.S. car market in the not-too- distant future will be dominated by autonomous vehicles, electric vehicles and ride-hailing services, a recent consumer study commissioned by the National Automobile Dealers Association (NADA) says otherwise.
According to a survey of 1,200 consumers conducted by Luntz Global, consumer demand for owning vehicles remains strong across all demographics.The study responded to recent reports from Wall Street analysts and others saying that the emergence of ride-hailing services like Uber and Lyft, combined with the prospect of electric and autonomous vehicles, will dramatically reduce the number of personally- owned vehicles in the future.
“Consumers overwhelmingly prefer the freedom and flexibility of owning a personal vehicle to ride-hailing services,” Jonathan Collegio, NADA’s Senior Vice President of Public Affairs, said at last week’s annual AFSA/NADA Forum. “This sentiment cuts across all demographics. Ride-hailing will continue to supplement personal vehicle ownership going forward, but will not supplant it.”
One of the key findings from the study shows that 89% of the respondents said they would rather continue owning a car, versus 11% who said they would prefer using ride-hailing services as their primary source of personal transportation. This sentiment is overwhelming even among millennials, who prefer vehicle ownership by an 80-20% margin. Importantly, millennials in the suburbs or rural areas were six points less interested in ride-hailing than their urban counterparts.
“Other highlights of the study include:
- Consumers overwhelmingly view vehicle ownership as convenience, not a cost-drag or nuisance to own, as several studies suggest. Only 6.5% of consumers in the survey viewed owning a car as a hassle or costly nuisance.
- Consumers view wait times as a significant drawback of ride-hailing services. More than 88% of consumers said they would need to save at least $15 per day to incur an hour of aggregate waiting for ride-hailing services over a day. Half of consumers in the survey said they would need to save $50 per day to incur an hour of aggregate waiting time.
- Consumers are generally open to autonomous vehicle technology. 56% of consumers said they would purchase a fully or highly autonomous vehicle, while 44% said they would not.
- Consumers by an 80-20 margin would prefer to capture 80% of the safety benefits from semi-autonomous vehicles they can still drive, as opposed to 100% of the benefit from fully autonomous, driverless vehicles.
“As an industry we have to understand our customers,” Collegio said. “And as the industry plans for the future, we hope analysts will more deeply study and investigate how consumers use, value, and enjoy relying on their personal vehicles.”
June 26th, 2018 by Dan Bucherer