Car ownership is still an aspiration for many, but fewer people – including in Singapore - will want to own their own wheels in future, argued Associate Professor (Educator Track) Nitin Pangarkar from NUS Business.
He believes that this means the glory days for the global automobile industry are over as it runs up against the megatrends of greater urbanisation, the shunning of car ownership by millennials, and the emergence of the subscription economy.
As more people live in cities, governments are investing heavily in public transport networks while discouraging car ownership which contributes to congestion. Millennials are also less interested in buying cars than previous generations, while the subscription economy also poses further headwinds. Car sharing significantly impacts auto sales since any car in a fleet will be used by multiple subscribers.
Singapore will reflect the global trends in car ownership and usage. Factors include ride-hailing services that erode the additional convenience of owning a car, and the continued expansion of MRT networks that offer people a cost-effective alternative to personal transport. While some Singaporeans may continue to own cars, more may move away from car ownership in view of these developments.
With the trends in Singapore and around the world, Assoc Prof Pangarkar predicted that the global growth of car sales is going to be slow – if the growth is there at all.
Read Assoc Prof Pangarkar’s full commentary here.