Car owners who are driving less than 15,000 km a year could be losing out on substantial cost savings, according to a new report from Oliver Wyman, a global leader in management consulting and Bolt, Europe’s largest shared mobility company.
The report has found that while there has been a reduction of 1,700 km per year in the distance travelled by personal cars across Europe over the last decade, the number of vehicles registered per household has stayed the same, suggesting that cars are often sitting idle at home. In Ireland, the number of privately-owned vehicles on the roads rose by 215% between 1985 and 2020. Previous research from Bolt revealed that over one quarter (25.67%) of Irish drivers are likely to give up their car in the next five years if viable alternatives are made available, whilst over half (54.55%) cited the overall expense of running a car as a potential reason for giving up their car.
For those car owners driving less than 15,000 km a year, new data shows other modes of transport like ride-hailing, car subscriptions, scooter and e-bike rentals and car-sharing can be more affordable than owning a car.
The report looked at the total cost of ownership (TCO) in price per km for premium, SUV and compact cars, which decrease incrementally the more a car is driven, and compared them to the price per km of different types of shared mobility services, which carry no additional costs to the user, past the initial price.
In Ireland, though petrol and diesel prices dipped by two cents and one cent in October, the price of crude oil remains elevated at approximately $90 per barrel, an increase on the $70 barrels were valued at during the summer.
Car-sharing emerged particularly favourably as a cost effective transport mode, being cheaper than all three car types at an annual mileage of up to 15,000 km. Shared scooters and e-bike services were cheaper than a compact car at an annual mileage of 5,000 km, while even the most expensive shared mobility service, ride-hailing, proved cheaper than a premium car for an annual mileage up to 12,000 km. The analysis was conducted in Germany but applicable to all major European markets.
For those who cannot afford a car, the study also points out how shared mobility is a viable alternative, removing the key financial barrier of purchasing a car, scooter or eBike and connecting into public transport systems to provide better commuting access.
Fortunately for Irish citizens, the government is taking warmly received steps to ensure the country is well-positioned to transition away from a reliance on the private car. The recent Budget included an investment of €360m in cycling and walking infrastructure, as well as confirmation that the 20% fare reduction for all public transport (implemented last year as a temporary cost of living measure) will continue.
Notably, the government has also been taking great strides to enable an alternative transport mode which can ensure the cycling infrastructure is well used: the shared electric scooter. Legislation is expected to be finalised in the next couple of months. Given one third (33.4%) of private car journeys in Dublin are less than two kilometres according to the CSO, and over one fifth (20.9%) are 2 to 4 kilometres in length, the company with Irish headquarters in Dublin expect the two-wheelers to be a hit in towns and cities of varying sizes across the country.
Indeed, Bolt already offers shared electric bikes in Sligo, Kilkenny, Wexford, Bray, Dún Laoghaire-Rathdown, and Carlow. The firm is the largest scooter provider in Europe with scooters and e-bikes in more than 250 cities across 25 countries.
Head of Public Policy for Bolt Ireland, Aisling Dunne, said: “This report comes at a time that has real potential to be a watershed moment for the environment and transport in Ireland. It exposes the poor value for money private cars represent for urban dwellers across the country, just when cities and citizens are understandably assessing how far their euro is going.
“Thankfully a viable alternative is well on its way in the form of the shared electric scooter. We strongly encourage the NTA to continue this positive momentum by evaluating if the supply of taxis – especially in hospitality hotspots like Dublin – is proportionate to the amount of demand from passengers. Many of us will have first-hand experience of struggling to get a taxi.”
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.”
In addition to saving people money, the new report also found that greater usage of services like scooters and e-bikes can have environmental benefits for cities and the people living in them.
An analysis of how people used Bolt scooters in Europe found that around 10% of e-scooter rides directly replaced car journeys. As a result, e-scooters on their own contributed a reduction of up to 120 million car kilometres travelled, helping to alleviate traffic congestion and air pollution in cities and to reduce car-related emissions by an estimated 23,000 tons CO2e across Europe. The study also highlights the potential for aligned multimodal approaches between operators and Cities to cut personal car usage by 20% in Cities like Berlin.
