## UMTRI study concludes number of LDVs in the US likely has not yet peaked

##### 20 June 2013

A brief study by Dr. Michael Sivak, Director, Sustainable Worldwide Transportation at the University of Michigan Transportation Research Institute (UMTRI) concludes that despite the absolute number of vehicles in the US having reached a maximum in 2008, it is highly likely that—from a long-term perspective—the absolute number of vehicles in the US has not yet peaked.

However, he notes, the rates of vehicles per person, licensed driver, and household reached their maxima prior to the onset of the current economic downturn. As a result, Sivak concludes, it is likely that the declines in these rates prior to 2008 reflect other societal changes that influence the need for vehicles (such as, increases in telecommuting and in the use of public transportation). Therefore, the recent maxima in these rates have better chances of being long-term peaks as well, he suggests.

The US currently has about 253 million registered motor vehicles of all types, according to the Federal Highway Administration (FHWA). The focus of this research was on light-duty vehicles (cars, pickup trucks, SUVs, and vans). The number of light-duty vehicles in 1984 stood at 156.8 million. The number reached a maximum of 236.4 million in 2008. In 2011 (the latest year available), the number was 233.8 million.

The number of vehicles reached a maximum—at least for the time being—in 2008, the year of the onset of the current economic downturn. The value in 2011 was somewhat higher than the lowest post-2008 value, which was reached in 2010. This is the expected pattern, with the changes in the number of vehicles lagging the changes in the general economy.

Given that US economic conditions are improving and that the US. population is expected to continue to grow, it is highly likely that the maximum number of vehicles reached in 2008 will be surpassed in the near future.

—Michael Sivak

In terms of the rates of vehicles per three variables of interest:

• Vehicles per person. In 1984 there were 0.66 vehicles per person. This rate increased to a maximum of 0.79 in 2006. The latest rate—for 2011—was 0.75.

• Vehicles per licensed driver. In 1984 there were 1.01 vehicles per licensed driver. This rate increased to a maximum of 1.16, which was reached in 2001, 2005, and 2006. The rate in 2011 was 1.10.

• Vehicles per household. In 1984 there were 1.84 vehicles per household. This rate increased to a maximum of 2.05, which was reached in 2001, 2005, and 2006. The rate in 2011 was 1.95.

...because the changes in the rates from 2008 on likely reflect both the relevant societal changes and the current economic downturn, whether the recent maxima in the rates will represent long-term peaks as well will be influenced by the extent to which the relevant societal changes turn out to be permanent.

—Michael Sivak

"The number of light-duty vehicles in 1984 stood at 156.8 million. The number reached a maximum of 236.4 million in 2008. In 2011 (the latest year available), the number was 233.8 million."

"it is likely that the declines in these rates prior to 2008 reflect other societal changes that influence the need for vehicles (such as, increases in telecommuting and in the use of public transportation). Therefore, the recent maxima in these rates have better chances of being long-term peaks as well, he suggests."

-So the headline should read,"US Auto volume has reached Plateau".
It looks like we have reached the peak and we can hope to return to it but based on economics, societal changes, demographics etc., it's unclear if that peak is sustainable.

I fail to see the supporting evidence for the potential growth the headline purports to support is likely.

It's not surprising though as University of Michigan gets a lot of money and support from the automotive industry so concluding the U.S. industry is in decline would be like biting the hand that feeds you.

USA and EU are going through extended long term economic downturns since 2008. The last time (1929) it lasted for 10+ years, until WWII.

For the time being, USA is trying the 'print $$' itself out of the current economic crisis. It may take more than 85B/month of new green backs to correct the systemic causes. In reality, most of that new money (and even more) is quickly re-directed to illegal tax free paradises by the 1% to 3%. This on-going drain on the US's and EU's economies will make matter worst. Unless corrected, the current economic crisis will deepen and extend into the next decade. As the economic crisis deepens, a greater proportion the 97% to 99% will not have high pay jobs and will not buy and operate as many cars and light trucks. The trend is going on at a fast growing rate in most EU countries. The same will most probably happen in USA and Canada as soon as the$$$printing is slowed down. Higher profits at all cost while avoiding most taxes is draining too much from the US and EU economies. Poorer unemployed middle and lower classes will buy less and less new vehicles, appliances, etc etc. One way to stop this progressive down slide would be to have the upper class (the 3%) pay more taxes (35% to 40%), to reduce taxes (15% to 20%) for the middle class and to (0% to 5%) for the lower class. This way the 97% would have more$ and would buy more cars, light trucks, appliances etc etc.

Governments could recover lost revenues from higher liquid fuel taxes and higher sale taxes on luxury goods, cars, houses etc.

The comments to this entry are closed.