The future of the global car market
Jeremy Hobson: Tomorrow, we’ll find out how fast the Chinese economy is growing. Economists are expecting to see a little bit of a slowdown, but we’re still talking about an annual rate of about 8.5 percent. Our economy is in the 1 to 3 percent range. Now, as China’s economy has boomed, Chinese people have been buying a lot more stuff — from houses, to iPhones, to cars.
And cars in developing countries like China and India are the subject of our quiz with quizmaster Stephan Richter of TheGlobalist.com. Good morning Stephen.
Stephan Richter: Good morning, Jeremy. Ready for today’s quiz?
Hobson: I am ready.
Richter: All right. As you said, thousands of new drivers in China and India are all getting behind the wheel every day with their new car. If the entire world had the same rate of car ownership as we have in the United States, how many cars would be on the world’s roads?
Richter: Would it be 1.7 billion cars; 4 billion cars; 5.5 billion cars; or just a tad under 7 billion cars?
Hobson: All right, I’m going to go with B) 4 billion cars. I don’t really think that we could more than quadruple the number of cars if everyone was driving like we do in the U.S.
Richter: That would be true, and is true, if only we’d be like West Europeans. The West Europeans have roughly 580 cars per 1,000 people. But of course, we Americans outdo them — so you have to up your guess a little bit, I would think.
Hobson: All right, then I’ll go with answer C)5.5 billion cars — although that seems like a huge number, considering what, there are only 7 billion people in the world right now?
Richter: Exactly. And that of course, is what mathematically would be forecast if we all did like Americans.
Richter: That’s an impossibility, even as we stand after the Durban Summit, with all the pollution that we still have to get rid of. But, remember this: the only good news is that the IEA — the Paris-based International Energy Agency — assumes we’ll have 1.7 billion cars on the road by 2035. Other industry forecasts are more: 4 billion. But of course, you wouldn’t expect any other forecasts from the Fords and other companies of this world.
Hobson: How many cars do you have, Stephan?
Richter: We have one. We’re a very enlightened family. I mostly use the subway and the bike, and we just use the car for things where we really can’t schlep it on our backs or walk it.
Hobson: Stephan Richter, clearly a good environmentalist and editor-in-chief of TheGlobalist.com. Thanks as always.
Richter: Thank you.
Marketplace is on a mission.
We believe Main Street matters as much as Wall Street, economic news is made relevant and real through human stories, and a touch of humor helps enliven topics you might typically find…well, dull.
Through the signature style that only Marketplace can deliver, we’re on a mission to raise the economic intelligence of the country—but we don’t do it alone. We count on listeners and readers like you to keep this public service free and accessible to all. Will you become a partner in our mission today?