The Car Industry in a world with Ten Billion People

Catastrophe, disaster, imminent meltdown – the verdict is out and it’s rather gloomy taken at face value. Stephen Emmott’s new book Ten Billion, is a continuation of Malthusian belief that the earth has reached its full capacity and will not be able to support the ten billion people that will live on the earth by 2050. Malthus was wrong so what has changed for Emmott to believe that we really are about to reach that point? I am not going to go into that. It’s far too long and complicated to do so what I hope will be a short blog. Instead my focus is not on the book but on the BBC discussion that took place during the Start the Week show on the 1st of July. (This article has been on my mind for a while)

Crowded swimming pool in China

I am going to focus on a very small aspect of the discussion in which respected thinkers spoke about the challenges ahead for mankind. The panel consisted of Stephen Emmott, Danny Dorling, Jill Rutter and Amartya Sen. It feels a little weird to criticise such wonderful minds, but I am keen comment in something that was mentioned during the discussion. It also happens to be something that bugged me during a Green Monday event in London a while back.

In Japan, there has been a steady decline in the number of cars purchased on a yearly basis. The stagnant economy is partly to blame for that one can assume. At the same time, every major car company has predicted that 2.5 – 3 billion cars will be produces in the next 50 years. That means extracting a vast amount of materials from the ground, shipping components around the world to be assembled and delivered to end consumers. Toughening regulations around emissions and cradle to cradle design will have a massive impact on the way that cars are made but changing consumer behaviour and technology will have an even bigger impact on the car industry as we know it.

My points are as follows:

  1. ZipCar, BlaBlaCar and other car sharing schemes are already coming to the fore. Economically it makes less and less sense to own your own car in a city. As 80% of the global population will live in cities by 2050, it’s only natural that government policies will make it increasingly difficult for city inhabitants to own cars. At the same time, the proliferation of internet delivery options means trip to the supermarket for that big shop once a month will be highly unlikely.
  2. Car companies will overplay the desire for automobiles in order to ensure that their share prices do not plummet. At the same time, these very same companies are fully aware of the future of car travel and are preparing for it. Both Mercedes and BMW have felt the imminent threat posed by companies like ZipCar and have started to explore the service model themselves. Customers are able to rent cars which recognise the customer’s keys and automatically adjust settings for that customer. This ensures that rental cars are more personalised than ever making it less likely for people to own cars. BMW have also just released the i3 car for the mass market which is built specifically for urban mega-cities like New York, London and Shanghai. It uses carbon fibre and other recyclable materials and is challenging the likes of Tesla.
  3. The current tendency in the West is a reduction in the number of drivers. Even in car happy America, the more youthful populations are moving away from cars and commuting, living in cities where it’s easier to get around by foot.
  4. Many companies are already working on self-driving cars with Google’s version being the most publically discussed. Other companies have already integrated computer assisted driving into their fleets. These systems aid the driver to stay awake, remain in the correct lane and keep the right amount of distance from the car in front. Once fully automated cars are in play, it will no longer be necessary to even have a driver’s licence. Yet this will not lead to an increase in car ownership since, as already stated in point 1, it will be just as easy to rent a car for the day or even by the minute.
  5. The global south has already shown through its adoption of mobile phones, that it is ready to leapfrog western countries in many ways. Car travel is going to be one of those. It may currently be a status symbol as it was in the West. But it is not going to catch on in the same way – you only need to see the Beijing skyline to realise that.

bmw i3 BMW i3

So why own a car, when you can rent and then plan your day on your phone? You pay insurance only when you use it, no need for a resident parking permit as you can send the car back to where it came from at the end of its use and no need to worry about finding a parking spot at the end of the day… ever again.

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