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A study concludes Work-From-Home Culture Will Cut Billions of Miles of Driving.

The research conducted by consultant KPMG International finds the cocoon culture Covid-19 has created is not going away -- even if a vaccine is made widely available -- and that will have potentially dire consequences for the auto industry.

“If two of the primary missions that the American public buys a car for are going to reduce in demand, we know that’s going to have an adverse impact on auto sales. It’s just like gravity.”

Key Findings

  1. During the height of the pandemic in April, Americans sheltering at home drove 64% fewer miles, an unprecedented decline in travel.  Less driving is the new normal.
  2. Increased working from home and online shopping will reduce driving in the U.S. by up to 270 billion miles a year, a 10% permanent reduction of the almost 3 trillion miles typically traveled every year.
  3. Commuting decline will remove 14 million cars from U.S. roads
  4. Vehicle ownership will decline to slightly less than two cars per household.
  5. New car and truck sales will decline by roughly 1 million vehicles per year.
  6. Fewer miles driven and fewer cars on the road also means dealers and mechanics will have less money coming in from repairs and other after-market services aimed at keeping cars running.

Covid Accelerated a Trend 

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Covid did not cause a trend change. Rather, it accelerated trends in place.

  • Online shopping was already making huge year-over-year increases.
  • New technology made virtual meetings more productive. Companies needed a push to head that way quicker and got a big one. 
  • Retiring boomers are looking to downsize.
  • Millennials do not have the same love for cars or driving as their boomer parents.
  • Cars are getting more and more expensive, fewer people can afford them. 
  • In cities, Uber and Lyft are widespread enough for many to ditch cars.  

On Demand Rentals

Big changes in the way car rentals work once self-driving takes hold. But self-driving interstate trucks will beat cars. For now, Covid delayed those trends. Congress is now overwhelmed with stimulus deals, immigration, and DACA.