Page 53 - 2019 Auto Show Guide

espite media reports, Silicon Valley predictions and Wall to ride-hailing services. Most pro-ride
hailing reports suggest that the cost
DStreet prognostications to the contrary, the principle of per- savings of using ride-hailing services

sonal vehicle ownership in America is not under threat from au- over owning a car is $3,445 per year per
household. That probably sounds pretty
tonomous vehicles and ride-hailing services. good to the average consumer.

However, the numbers don’t bear out
That’s according to NADA’s Senior Vice The High Cost of
President of Public Affairs Jonathan Col- when consumers dive deeper. Even
Waiting for a Ride on the conservative side of calculat-
legio, who is busting the myth on the
ing for an average six-minute wait for
end of personal vehicle ownership.
“One of the things you hear a lot Consumers like their cars because a ride-hailing service multiplied by 10
about in the automotive the value proposition of owning a car trips a day for 365 days a year, the cost
industry and the retail goes beyond getting from one place savings of ride hailing over personal
technology sector is to another, Collegio noted. “It’s more vehicle ownership comes out to un-
the convergence of au- than that. It’s the ability to go wherever der $10 per day, Collegio said. “You’re
tonomous vehicles and you want to go, whenever you want to talking about exchanging an hour a day
ride-hailing services like go with no waiting. With no one con- in waiting for a savings of about $9.44
Uber or Lyft,” Collegio said. trolling your agenda. Just being able to per day. That’s less than minimum wage
get in the car and go.” in 16 states.”
The media reports suggest that
autonomous technology will And Americans are increasingly on the NADA Chairman Wes Lutz recently
make ride hailing so cheap that go. The Department of Transportation made a similar point on the overly op-
people will get rid of their personal estimates that the average U.S. house- timistic cost savings reports of ride-hail-
automobiles and go exclusively to hold takes 10 car trips per day. Most of ing services in remarks to the Automo-
using ride hailing, Collegio explained. them are extremely mundane, but nec- tive Press Association in Detroit this
“Now, representing automobile deal- essary trips, like going to the grocery month.
ers, this is obviously something we store, the dry cleaner, going to a friend’s
need to look into, because we sell cars. house, taking the kids to school or to For most consumers, the savings would
We wanted to know if people were re- soccer practice, Collegio pointed out. have to be a lot more than $10 a day for
ally as interested in getting rid of their “Trips that are so mundane, you don’t them to give up their time. Of the 1,200
vehicles as reports from Silicon Valley think of them three hours later. That’s consumers surveyed by NADA, 88.5
and Wall Street have suggested.” how people generally use their cars.” percent said they’d have to save at least
$15 in order to give up an hour of their
day to waiting, 50 percent said it would
What NADA has found instead is that What’s more mundane than trips for
consumer demand for personal vehi- household chores? Waiting. The av- need to be $50 or more in savings, and
cle ownership remains overwhelmingly erage wait time for an Uber or Lyft is 35 percent said they would not take
strong across all demographics. A re- about nine minutes. For 10 trips a day, any amount of money to wait an hour a
cent NADA-commissioned survey found a customer completely dependent on day. “Silicon Valley and Wall Street are
that even after hearing about all the ride-hailing services would spend 90 just kind of ignoring the fact that time
benefits of using ride-hailing services, minutes a day waiting. is valuable and that there are a lot of
people who are not interested in saving
nine in 10 consumers said they’d rather
keep owning their car. The survey over- “If you consider what your life would money if it means giving up their time,”
sampled millennials, the largest group look like if you had to use Uber or Lyft or Collegio pointed out.
of consumers, and found that four out a ride-hailing service for each of those
of five millennials said the same thing— mundane trips, it starts to not look all The threat to personal vehicle owner-
they prefer to own their own car. that attractive, mainly because of wait ship isn’t going to come from a free and
“The results were really interesting. times,” Collegio explained. “A lot these open marketplace or lack of consumer
They go against the conventional wis- reports don’t estimate the time cost of appetite for owning a car, as the NADA
dom that’s out there, that folks are go- money – People value their time, and survey shows. If there is a threat, Colle-
ing to get rid of their vehicles and move suddenly adding an aggregate block of gio said, it’s more than likely going to
exclusively to these services,” Collegio 90 minutes waiting time to your day is come from lawmakers tilting the scales
said. “It grounds us in a reality that peo- not something people want to do.” too much when it comes to regulating
the marketplace. “If it’s going to come
ple like their cars.”
What is Your Time Worth? from anywhere, it’s probably going to
come from state and local governments
that are being pressured by large com-
If people really do believe the old ad-
panies,” Collegio said. “That’s the thing
age that time is money, their wallets are
for our customers to really be aware of.”
in for some sticker shock when it comes
37 ANNUAL ATLANTA INTERNATIONAL AUTO SHOW 49
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