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Behavioral Economics

Why we aren’t at ‘peak car’ yet — and what can reverse the trend

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There are many reasons for the United States to try to give up its love affair with cars. The transportation sector is the leading contributor to carbon emissions, most cars sit idle up to 95% of the time, and the annual cost of car ownership exceeds $9,000.

Still, the country isn’t at “peak car,” as purchase and use of private cars is rising. Americans value cars despite their expense; prior to the pandemic, 76% of Americans drove to work alone. Contrary to popular belief, not only do millennials own cars at the same rate as older generations, they drive 2,200 more miles per year than baby boomers. Plus, many Americans see their sports car, luxury sedan, or four-wheel SUV as a status symbol.

What will it take to reverse this trend? In a recent podcast, Joanna Moody of the MIT Energy Initiative’s Mobility Systems Center and a professor in the MIT Sloan System Dynamics Group,  addressed three important questions about how to shift the U.S. away from private car ownership.

  • How can the United States transition to multimodal transportation, especially for short trips? Almost half of U.S. car trips in cities are three miles or less; even a small shift from driving to walking, cycling, using mass transit, ride-sharing, or renting cars could significantly decrease congestion (and pollution).
  • Can alternatives to private cars provide the same level of convenience? Because vehicles sit idle most of the time, they’re ready at a moment’s notice, whether for an emergency trip to the doctor or a spur-of-the-moment vacation. “Car ownership is a security blanket for people,” Moody said. That degree of flexibility is hard to design into alternative transportation options.
  • What could be the most competitive “mobility as a service” option? One possibility is peer-to-peer car sharing: Think Zipcar, only with vehicles shared among, say, a small group of neighbors. Another is a monthly subscription model that mimics cable television packages and offers a sampling of both public and private transportation alternatives.

Listen to the full podcast with Keith and Moody below, and subscribe to the MIT Energy Initiative’s podcast series on Apple Podcasts, Google Podcasts, and Spotify.

MIT Energy Initiative · #33 - Cost of car ownership - David Keith and Joanna Moody, MIT

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