How Long Before America Hits 'Peak Car' For Real?

Economists, scientists and titans of industry often talk about "peak oil," the idea that one day we'll reach a point where oil supplies begin to decrease and will never rise again. But what about "peak car"? A new study argues that while the peak in cars on U.S. roads may be temporary, the peak in the number of cars per household could be permanent.

The University of Michigan's Transportation Research Institute just put out a study titled "Has motorization in the U.S. peaked?" that says the number of registered cars, SUVs pickup trucks, and vans in the U.S. did in fact reach a maximum point back in 2008.

After that, due to the onset of the recession and our subsequent economic decline, the number of registered vehicles began to drop as well.

According to the data, we hit a peak of 236.4 million light duty vehicles in 2008. That's quite a dramatic rise from 1984, when there were 156.8 million on the road.

And then the recession hit, causing the number of vehicles to drop down to a level last seen in 2004.

What's interesting to me about that graph is the severity of the decline after 2008. There have certainly been recessions off and on over the last three decades, including in the early '90s and early 2000s, and while they have caused declines in the number of vehicles on the road, none have been so dramatic as the most recent drop-off.

However, as you can see above, we're starting to rebound as the economy improves (though the 7.6 percent of Americans who are unemployed will probably tell you it's not happening fast enough.) In 2011, the last year the data was available, the number of registered vehicles rose again to 233.8 million. In other words, we're coming back from the drop-off.

It is important to note that because historical data of privately owned light-duty cars was not available, the study counts all registered light duty vehicles, including commercial, public and privately owned ones.

But it's still a good indicator of where this country has been, where it's at and where it is going in terms of car ownership. From the study:

Given that U.S. economic conditions are improving and that the U.S. population is expected to continue to grow (but by only about 11% from 2011 to 2025), it is highly likely that the maximum number of vehicles reached in 2008 will be surpassed in the near future.

So, in terms of total registered vehicles, we haven't necessarily reached a limit on the cars on the road. That's the good news for automakers. The bad news is the study also examined rates of vehicles per person, per licensed driver and per household and found all three rates reached their maximum levels between 2001 and 2006.

Obviously, that's before the recession happened, so what's going on there? The study says that can be attributed to rises in both use of public transportation and telecommuting, as well as other societal changes.

The study does note that while the absolute numbers of persons, licensed drivers, and households strongly correlated over the last 30-odd years, that may change as the age of the driving population increases, as has the age of car buyers themselves:

...the peak probability of purchasing a vehicle per licensed driver has recently shifted from those 35 to 44 years of age to those 55 to 64 years of age.

The study is somewhat inconclusive on whether those peaks will remain in place. It notes that will depend on whether those social changes are permanent or not.

There has been a lot of concern among automakers lately whether American car ownership is permanently on the decline, something that can be attributed to rising gas prices, the aging Baby Boomer population hanging up their keys for good, and Millenials who are too broke to buy cars only care about their iPhones.

Given the trends we've seen here, I don't think that's the case. Americans have given up their cars when faced with recessions before, and when the economy rebounds, they start to drive again. The same thing appears to like it could happen here, it's just that we have a much more severe decline to crawl out of.

Even if we have reached a peak in per-household ownership, that's not necessarily a bad thing as most of those extra cars are boring, bloated, polluting machines just designed to commute. The fewer of those cars on the road the more space there will be for those of us who enjoy driving for pleasure.

In the meantime, it's possible America will hit peak car someday. But we're not there yet.