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Why I Think Car Sales Will Stagnate and Then Slide Downhill in 2020

Let's pause for a moment, put on hold our busy and fast-forwarding lives as car drivers and ask ourselves this simple question: what is that mankind needs to get by every day? Automobiles or mobility?
It's not a trick question, but it's by no means an easy one. Carmakers will tend to say all we need is cars because that's their bread and butter, and those hundreds of thousand of vehicles produced every year need to be sold to keep the industry alive and bank accounts stacked with zeros.

I was a teenager too, and the dream of auto ownership was strongly embedded in my mind. However, a part of our evolution as a species is represented by the introduction of public transport, bicycles and more recently, car sharing and carpooling services.

Furthermore, analysts and some journalists are more and more generous in using the term "Peak Car" whenever they are talking about the future of the car as we know it. Peak Car is not a new theory, as its origins can be traced back to 1930, when the automotive industry was just getting rid of its diapers.

Moreover, it was only one year ago when IHS Automotive estimated that in 2020, annual global car sales will crest at 100 million units then begin to descend like an avalanche coming down a mountain.

But guess what: in 2013, global car sales set a new record: 82,8 million vehicles were sold worldwide, which could mean the dawn of the auto world could be closer than we think. You'd have to thank the Chinese market for that boost, as the country's upper social layers have been stretched, and more people afford to own one or more cars.

Just like the forces pressing on the snow will exceed its strength and cause mechanical failure in the snowpack, the car industry might crack under its own weight for several reasons. One of them is the excessive urbanization and the suffocating growth of cities, that still can't contain the skyrocketing number of cars that roam their streets.

More cars mean pollution is given an environment to thrive in, so as governments and city leaders impose bans and forces measures on traffic in strangled megacities, owning and using a car will soon enough turn into a living nightmare.

The expansion of public transportation system is not helping either, as the main cities around the globe are continually improving their bus, tram, and metro infrastructure.

It's safe to say car manufacturers have been looking for ways of avoiding a permanent fall of the universe they created by turning their heads to EVs and hybrids, although the appearance of new car segments like crossovers, for example, is not helping as their appeal to the public is high and won't fade away anytime soon.

Just think about how conservative brands like Bentley and Jaguar are building crossovers and you'll get a picture of where this small-SUV craze is heading.

The only real prospect for the car industry would be if EVs and PHEVs would see a massive increase in popularity and eventually ended up in dominating the markets, but that's a scenario that needs lots of time to materialize, not just the five years we have left until 2020.

 
 
 
 
 

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