'The world may never see 100 million new car sales in a year'

Sorry, I got it wrong. A couple of years back I slipped into forecasting mode (similar to and almost as dangerous as betting on the horses), and predicted consumers of the world would by now be buying or leasing at least 100 million new cars a year. 

Truth is, this hasn’t happened. The relentless growth in car sales we’ve witnessed over recent decades has, for now at least, stalled. Only around 86 million private individuals and businesses signed up for fresh-from-the-factory vehicles last year.

• New car sales 2019

That’s fewer than in 2017, and 2019 is expected to be another flat year. As far as car sales in the 2010s are concerned, they’ve peaked. At best, we’ll have to wait until the roaring ’20s before that psychologically important 100m-per-annum barrier is breached.

In one sense, 86 million car sales a year is impressive. But we need to remind ourselves that this figure is surprisingly low in view of the fact there are now hundreds of millions – possibly billions – of in-work or comfortably retired consumers across the globe with incomes large enough to place them in new-car territory.

In China, India and Brazil, for example, salt-of-the-earth working-class folk have wealth like never before. But they’re just not signing up for new cars in the numbers I, for one, expected them to.

Maybe they’re holding back due to financial uncertainties on a national, international or, more likely, personal level. Or perhaps a lack of consumer confidence and/or long-termjob security fears prevents them from acquiring the keys to new cars. Perhaps they are simply opting for used vehicles instead, deeming factory-fresh models too expensive.

Another factor is the politicians at home and abroad, with their war on diesel and the fines or bans they slap on motorists who dare to drive personal vehicles in city centres.

It’s also becoming increasingly difficult and expensive to qualify as a driver with a full licence then buy proper, eye-wateringly expensive insurance cover. Some might ask why they should bother learning to drive at all when autonomous cars will soon do all the driving for them – before adding that while they’re waiting for the driverless revolution to arrive, they can always use existing car sharing, ride-hailing and other services.

Being transported door-to-door in cars by ‘professional’ drivers charging reasonable fares has never been more convenient. And the process will, in theory, get cheaper and easier when autonomous tech takes over and driver wages are removed from the equation.

In crude terms, today’s ‘norm’ is that one private car is purchased and driven by one private car owner each day. But the ‘new norm’ will be one public car, without a driver, carrying, say, 100 folks over the same period. That, in turn, will translate into a single sale for the global motor industry, not the 100 sales it would have previously enjoyed. 

No wonder manufacturers are currently struggling to sell 100 million cars a year, never mind the hundreds of millions they could – and perhaps should – be selling in a world that comprises nearly eight billion people.

Enjoyed reading this? Then you can find more of Mike's columns here...