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By Greg Gardner, Detroit Free Press (TNS)

DETROIT — Global new car sales will soar from 70 million in 2010 to 125 million by 2025, but the way those cars are used and who will own them is going to change rapidly according to a new report from the McKinsey consulting firm.

Urban Mobility at a Tipping Point is a 22-page discussion of the trends such as in-vehicle connectivity, electrification, car sharing, ride-hailing and autonomous vehicles that are expected to create new options for how people get around, especially in big cities.

While the report, which is co-authored by experts from McKinsey offices in Detroit, Stamford, Conn., San Francisco and Los Angeles, steers clear of sweeping predictions that Google and Uber will dominate this new market, it raises a series of provocative questions.

It does recognize that individual vehicle ownership is not going to disappear. One chart illustrates that, even in the technology-embracing San Francisco Bay Area, the cost of travelling 10,700 miles per year by ride-hailing services such as Uber or Lyft (more than $22,000 per year per vehicle equivalent) is more than twice as expensive as a financed new vehicle (about $9,200 per year) and nearly three times as expensive as a financed used car ($7,500 per year).

That’s even factoring in parking costs and California’s higher-than-average gasoline prices.

But the McKinsey study says that for those who use Uber or Lyft for shorter distances per year, the cost is more competitive.

Car sharing, through companies such as ZipCar, now owned by the Avis Budget Group, also continue to grow. Other major rental companies, as well as automakers, are getting into that market. Daimler launched Car2Go. BMW has Drive Now. Earlier this year Ford introduced Peer-2-Peer, a car sharing option being tested through November in Berkeley, Calif., Oakland, Calif., and San Francisco; Portland, Ore., Chicago and Washington, D.C., as well as London.

Ford Credit is inviting 14,000 customers in the U.S. and 12,000 in London to sign up to rent vehicles to prescreened drivers for short-term use. U.S. customers participate through software provided by ride-share company Getaround.

The strongest economic argument for car-sharing, in McKinsey’s view, is that instead of sitting idle for 90 percent of their useful lives, car-sharing vehicles will be on the road much more and perhaps reduce the number of cars on the road.

“There is little argument that widespread car-sharing would mean each vehicle gets used more intensively, thereby increasing its annual mileage from 11,700 to 20,400 miles.”

U.S. new vehicle sales are running near record levels, but most of the global growth in new car sales will continue to come from emerging markets.

Traditional automakers are phasing in various levels of autonomous driving, but so far they aren’t moving away from personal ownership as the foundation of their business model. New players such as Google and Uber, and perhaps Apple, may pursue fleet-based, on-demand services that could change the way some consumers look at vehicles.

“If I were in Google’s or Apple’s shoes I would try to acquire as much automotive talent as I could,” said Stefan .Knupfer, one of the study’s authors.

The McKinsey report cites data from the University of Michigan Transportation Research Institute showing that the rate of vehicle ownership in the U.S. has fallen from 0.79 vehicles per person in 2006 to 0.74 in 2012, while vehicles per household has dropped from 2.05 to 1.93 in the same period.

The report counters recent data published from automakers showing that millennials — those born after 1980 — are beginning to buy cars and trucks in numbers comparable to older generations.

“Surveys has found that American millennials are 16 percent less likely to commute by car to work, use public transit almost three times more often and are 23 percent less interested in owning a car that the generation that precedes them,” the authors wrote.

Near the end the McKinsey authors provide this observation.

“Given rising incomes and aspirations, there will be more demand for mobility. That will stress the world’s infrastructure, as well as its nerves.

“So what will the future of urban transit be ? Our view is that it will be more on-demand, with more sharing, and it will provide a broader spectrum of services … Urban mobility will likely be lower cost, faster and safer, and the lines between private and public transport will be increasingly blurred.”

(c)2015 Detroit Free Press. Distributed by Tribune Content Agency, LLC.

Foot traffic streams past Uber offices on Market Street in San Francisco. (Karl Mondon/Bay Area News Group/TNS)

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