Car owners driving less than 9,000 miles should consider shared mobility, new report finds
Updated: Nov 16, 2023
In a new report conducted by consultancy firm Oliver Wyman and mobility giants Bolt, it has been revealed that car owners who drive less than 9,000 miles a year could be losing out on substantial cost savings. The study indicates that alternative modes of transport, such as shared mobility, can be more affordable for these individuals.
The report highlights a significant reduction of over 1,000 miles per year in the distance travelled by personal cars over the past decade. However, despite this decrease, the number of vehicles registered per household has remained the same, suggesting that cars often remain idle at home.
According to the latest data from the Department for Transport (DfT), the average mileage of all cars in the UK is only 6,600 miles. This signifies that a significant number of car owners could save more by considering other means of transportation.
Shared mobility, encompassing services like ride-hailing, taxis scooter and e-bike rentals, and car-sharing, is expected to constitute 7% of all urban transport journeys globally by 2030. This projection, an increase from the current 3%, would elevate the total market size to £326billion, as per research by Oliver Wyman.
The report analysed the total cost of ownership (TCO) in price per kilometre for premium, SUV, and compact cars. It compared these figures to the price per kilometre of different shared mobility services, which do not carry additional costs beyond the initial price. Through this comparison, the figures were converted to miles.
The findings indicate that car-sharing is a cost-effective transport mode, being cheaper than personal cars for annual mileages of up to 12,500 miles. Shared scooter and e-bike services are cheaper than a compact car at an annual mileage of approximately 2,500 miles. Even ride-hailing, the most expensive shared mobility service, proves cheaper than a premium car for an annual mileage up to nearly 7,500 miles. While the analysis was conducted in Germany it has implications for markets across Europe, including the UK.
Additionally, the report emphasises that shared mobility presents a viable alternative for individuals who cannot afford to purchase a car, scooter, or e-bike. It eliminates the financial barrier of owning a vehicle while offering better access to public transport systems for commuting purposes.
The rising cost of car ownership in the UK, propelled by the flourishing second-hand car market driven by the global shortage of new cars, is a significant factor discussed in the report. Coupled with skyrocketing fuel prices that reached all-time highs last year, owning a car is becoming economically less viable for many people in the country.
As shared mobility continues to gain popularity, it is crucial for car owners driving fewer miles to consider the potential cost savings and increased affordability offered by these alternative transportation services.
Junior Masandi, 34 from London, is one of the increasing number of people in the UK choosing to ditch their car in favour of more cost-effective shared mobility alternatives: “I gave up my car in the height of the pandemic in 2020. Insurance and the ever-rising cost of fuel coupled with expensive parking and congestion charges made it clear that owning a car was becoming financially unsustainable. The decision to ditch my car was not just about convenience; it was a practical response to the economic realities of living in the city.
“Now I use a mix of public transport, cycling and ride-hailing services for when I want a direct route. It's all about striking the right balance between efficiency, sustainability, and affordability for my daily travel needs – and my friends do the same. I’d only consider owning a car again if the cost dynamics shifted or if I relocated but, so far, I’m happy without!”
Markus Villig, Bolt’s Founder and CEO, said: “We are in the middle of a cost of living crisis: fuel prices have soared, and many people are using their cars less as hybrid working has become more common. Many are already taking advantage of the substantial cost savings offered by switching away from private car ownership and using other modes of transport, but there is potential for millions of others to do the same.”
Dr Andreas Nienhaus, Head of the Oliver Wyman Mobility Forum, who led the study, said: “The mobility sector has changed dramatically in recent years and in addition to cars there is now a range of different modes of transport available to people. Cars will still be a necessity for some depending on where they live or their job, but what this report shows is that switching away from private car ownership can have significant benefits for many, particularly those living in cities.”
