Global Car Market Likely to Peak by 2024

Worldwide annual demand for new passenger vehicles will peak at roughly 100 million units within the next decade from about 82 million last year, says Bloomberg News, citing a forecast by IHS Automotive.

By then, the news service says, carmakers must be prepared for a future of no net growth as an increasingly urbanized population turns to cheaper and more convenient transportation alternatives.

The United Nations forecasts that the world's population will expand from 7 billion today to 9.3 billion by 2050. Virtually all that growth will be absorbed by urban areas. About half the world's population already lives in urban areas. By 2050, the UN predicts, that ratio will rise to two-thirds globally and to 86% in economically developed regions.

Both trends cited by the UN are beginning to reduce car ownership in cities.

Car sales in the U.S. may have already peaked, according to Michael Sivak, director of sustainable worldwide transportation at the University of Michigan Transportation Research Institute. He says nearly 9.2% of American households don't own a car today compared with 8.7% five years ago. UMTRI says the ratio of non-car households is growing in 21 of America's largest cities.

Bloomberg cites U.S. Census data that shows the proportion of carless households in cities such as New York, Washington and San Francisco is already more than 30%.

Carmakers including BMW, Daimler, Fiat, Ford, PSA, Renault, Toyota and Volkswagen are testing consumer interest in car-sharing schemes as an alternative to private vehicle ownership.

Southfield, Mich.-based consultant AlixPartners LLP estimates that every vehicle in a car-sharing fleet eliminates 32 retail car sales. The firm calculates that car-sharing services such as Zipcar have cost the auto industry 500,000 vehicle sales since 2006. AlixPartners forecasts the number of car-sharing users in the U.S. alone will quadruple to 4 million by 2020.