Americans Add Cars, But Cut Miles

◈ Americans Add Cars, But Cut Miles

 

The Covid-19 pandemic changed how Americans get around in ways that could be long-lasting. What it didn’t change was our appetite for cars and pickup trucks.

Before the pandemic, the number of registered vehicles on U.S. roads grew at about the same pace as the amount of driving being done on those roads. As we collectively drove more, we needed more cars and trucks to ferry us around.

 

The pandemic, which closed stores and workplaces, sharply curbed our driving. But we kept adding more vehicles on the road, even though prices shot up because shortages of computer chips cut back the number of vehicles for sale. The result: We have more cars but are putting fewer miles on them. Forecasts suggest that isn’t likely to change.

 

What’s behind this divergence? First, let’s look at the number of vehicles in operation, which grew to about 284 million in 2023 from 278 million in 2019, before the pandemic got under way.

 

It isn’t that people are buy-ing a second or third vehicle in greater numbers. Rather, the growth in vehicles roughly matches the growth in the number of U.S. households.

 

The average number of vehicles per household has stayed steady at about 2.2 for at least two decades—with a brief drop following the 2007-09 recession, according to S& P Global Mobility.

 

What has changed are the types of vehicles we buy. Americans have been moving away from passenger cars and toward bigger, more expensive pickup trucks and sport-utility vehicles. All those vehicles had to stay in the garage during the pandemic. Now, with the pandemic largely behind us, many of those vehicles are still there.

 

As of 2022, the number of trips Americans took had fallen by more than a third compared with 2017, according to surveys conducted by the Transportation Department. (A trip here is defined as going from one place to another. In other words, driving to the grocery store and back counts as two trips.)

 

The rise of remote work ac-counts for some, but not all, of this decline. Shopping, restaurant dining and recreational trips, regardless of travel mode, are all down from 2017. The pandemic has turned us into homebodies.

 

How long will this last? Upto- date data suggest we aren’t going to return to old habits in the near future. Research by economists Jose Maria Barrero, Nicholas Bloom and Steven Davis shows that roughly 28% of workdays were at home in October, despite pressure from employers to get workers to return to the office. And the number of miles driven per capita in the U.S. has flatlined since spring 2022 at below prepandemic levels.

 

Meanwhile, many of us are still paying off our cars. Higher vehicle prices and Federal Reserve interest-rate increases have pushed up monthly payments to the point that more borrowers are having trouble paying back their loans.

 

The share of auto loans flowing into serious delinquency rose to the highest level since 2010 in the third quarter of 2023, according to the Federal Reserve Bank of New York.

 

Does this mean we are going to be buying fewer cars and trucks in the future? Don’t count on it, experts say.

 

The pandemic sent many families moving to suburban areas or to southern and western states, places where they are more likely to need cars, said Robert Puentes, president of the Eno Center for Transportation, a think tank.

 

“What happens to cities? What happens to downtowns? All these things are so wrapped up together and have direct impacts on travel trends,” he said. “It’s less about people’s driving habits.”

 

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