Thursday, February 27, 2014

Market Watch: The end of the car is coming


 Maybe there is hope, after all.

 . . . and bigger picture, let’s not discount the demographic and geographic shifts that threaten to reshape the auto market - among many other areas of Wall Street.

Mounds of data shows that in the wake of the Great Recession, Americans are moving back into cities in droves. One of the megatrands that comes from this re-urbanization is an increased reliance on public transportation and a shunning of cars.

In fact, last year billionaire real estate mogul Sam Zell said we may be seeing the “end of suburbia” as a result of this shift to cities - and if the suburbs die, so does the need for a preponderance of vehicles to commute in.

Younger Americans are clearly already moving away from autos. Consider that the University of Michigan Transportation Research Institute estimated that in 2010, 69.5% of 19-year-olds in the U.S. had a driver’s license compared with 87.3% in 1983 . This is thanks to urbanization, as well as the psychosocial trend that has put the “freedom” offered by mobile devices and technology on equal footing with the “freedom” once offered by getting behind the wheel of mom’s station wagon on the weekend. [Read the full article ...]

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