Ride Sharing with Self-Driving Cars Further Dooms Sedan Sales

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Sedan sales are on the decline as crossovers and SUVs become ever more popular. A new study predicts the advent of ride-sharing services that use self-driving cars could deal sedans an additional blow and slash demand in half by 2030.

The study, conducted by consulting firm KPMG, used cellphone data to figure out where commuters travel in three large U.S. cities. It looked at Atlanta, Chicago, and the Los Angeles-San Diego region for the study. Chicago drivers made shorter trips with many coming in at under 15 minutes while in Los Angeles rides were longer, up to 90 minutes.

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Based on the patterns showing where and when people drive, KPMG predicts ride-sharing services with self-driving cars stand the best chance of success in densely populated urban areas. Sparsely populate areas are likely to hold onto personal cars for longer.

The decrease in the desire to own cars will reduce sales of all vehicles, but the good old family sedan is the vehicle most in jeopardy. It’s because of how people will use self-driving ride-hailing services that puts sedans in the crosshairs.

There are some tasks that are ideally suited to sedans. These include the daily commute, running to the grocery store, or doing minor errands around town. You don’t need an SUV for these things because a sedan will do fine.

These are also the types of driving situations that are the ideal target for ride-sharing with self-driving vehicles. You don’t need to worry about getting a car of a certain size when you hail a ride to work. It simply needs to be able to carry you. Why bother owning that commuter car when there’s a service that can do the job instead and often with less hassle?

On the other hand, when it comes time for weekend adventures with the family, then the type of car you have matters more. You can’t take the family on a camping adventure in a subcompact and it’s equally challenging to pack everyone into a sedan for a holiday road trip. Those situations are the ones when people want an SUV and they’re the ones unlikely to be replaced by ride-sharing with self-driving cars.

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It’s a bold prediction given that 2030 is only 13 years away, but that’s a long time in the world of technology. Self-driving cars are making huge advances and legislation is gradually catching up to effectively monitor the process. If it continues at its current pace, the death of the American sedan could be closer than ever.

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Nicole Wakelin

Nicole Wakelin