Self-Driving Taxis Could Cut Demand For Sedans 50% By 2030 In USA (KPMG Report)

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Sales demand for sedans in the US could fall by more than half by 2030 due to the influence of self-driving taxis on the market, going on the findings of a new study from the consulting firm KPMG.

Interestingly, the study was based around the utilization of cellphone data as a means of mapping commuter travel patterns within 3 large cities in the US — making for a somewhat novel approach.

A truncated version of the findings could be to say that self-driving taxis (ride services using self-driving vehicles, to use their terminology) will first be adopted in “island markets” — that is to say, in densely populated urban and suburban regions where they are best suited. From there, they would then spread out.

“As costs for ride hailing drop, KPMG predicts that by 2030 many families will no longer need to own a sedan to get to work or do errands, but will hail a ride instead. The result will be a ‘precipitous decline’ to 2.1 million sedan sales annually in the United States by 2030 from 5.4 million sales currently, the study predicts, as families dump smaller sedans and keep larger vehicles for longer trips,” Reuters reports.

“KPMG said it used data collected from cell phones to analyze trips in Atlanta, Chicago, and the Los Angeles-San Diego metropolitan regions. In Chicago, many trips are shorter than 15 minutes. In Atlanta, the study found 75% of trips are between suburbs, not from the city center to a suburb. Los Angeles trips are the longest, with many rides taking 90 minutes or more, the study found.”

With regard to the predicted decline of the sedan, such a decline is of course already occurring, as consumers in the US (and elsewhere) have been flocking towards SUVs, CUVs, and pickup trucks in the US in recent years. The study from KPMG includes the prediction that eventually only 3 to 4 companies will be serving the sedan market in the US (as opposed to around 10 today).

Such a prediction, of course, depends to some degree or another on the lack of another pronounced drop in living standards as the result of a recession (or a depression for that matter). If there is another significant economic downturn in the US in the next few years, then SUV and pickup truck sales will likely fall quite a bit, and those of small economy cars may well pick up some.

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James Ayre

James Ayre's background is predominantly in geopolitics and history, but he has an obsessive interest in pretty much everything. After an early life spent in the Imperial Free City of Dortmund, James followed the river Ruhr to Cofbuokheim, where he attended the University of Astnide. And where he also briefly considered entering the coal mining business. He currently writes for a living, on a broad variety of subjects, ranging from science, to politics, to military history, to renewable energy.

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