Why are people so confident that full-fledged self-driving will decrease ownership? I get that cars are usually parked, but IMO self-driving could turn driving into a leisurely experience which would increase my desire to do it in a personalized/homey space, increase my desire to have a long commute, and increase my desire to drive purely for leisure as well (driving around country roads reading).

Because the price differential will make ownership a luxury.

In fact, your comment alludes to that. For you, a self-driving car is an opportunity to make a leisurely, personalized, homey space. That's wonderful, if one has the money for it - and many people do.

However, let's take a step back and look at the millions of people who say, "I want a car that gets me from A to B". They're not looking to own a leisurely, personalized, homey space. They're looking to get places, hopefully at the cheapest price and in the most reliable way. They're not looking to own something.

You note that cars are often parked. Given the low utilization of vehicles, it stands to reason that renting time in a self-driving taxi should be significantly cheaper than owning one. If that self-driving taxi can serve the needs of 3 people instead of one, you only need to pay for a third of it. Even if the profit margins are an outrageous 50%, you'd be paying 150% of 33.3% or 50% of the cost of owning a self-driving car. However, the pricing is likely to be even more favorable. If owning a car costs you $500/mo and you can get your transit via self-driving taxi for $150/mo, there's a huge cost incentive to switch.

I think that's the big thing. The cost advantage is going to be quite stark. Owning a car will cost many times what getting driven around by a self-driving taxi will cost. While many people can afford a car today, it's certainly a significant budget item for many. Even for those that can comfortably afford it, it's safe to assume that many will ditch the cost for something cheaper.

Ultimately, our tastes as a society change as our society changes. As the cost of owning a car becomes sky-high compared to a mostly-substitute, many people will switch to it. Not everyone will. People spend up for luxury items all the time. But luxury items are, well, not commodities. Even if you can afford a luxury item, if you don't value that kind of item, you won't pay up for it. Plenty of rich people see a car as just a way to get from A to B. They'll take the cheaper self-driving taxi. Plenty of low and middle income people will be able to stretch their budgets better lowering transportation costs substantially.

Even if you're skeptical of a dramatic change, let's say I propose that 10% of people that currently own cars would ditch them for self-driving taxis. I'm not even suggesting that it's changing society, but a 10% dip in demand is quite significant to an industry.

I think you're right that there would be something nice about having a leisurely, homey ride. It could be a wonderful experience. But luxury automakers already try to give their owners a much nicer experience than someone gets in a Civic and there are definitely more Civic's out there. It's that, while a Mercedes S-Class is lovely, the Civic allows them to spend their money on other things (or afford transportation at all). Similarly, self-driving taxis will allow people to spend their money on other things or more easily afford transportation. You certainly paint a desirable picture and there are definitely people that will choose your vision. However, I think more people will choose the economy of self-driving taxis.

Cars made horses a luxury item. Horses were no longer common transportation. The car was cheaper and better. It certainly wasn't perfect in all ways, but enough that horses became a luxury item.

The key thing that privately-owned cars have over on-demand cars is reliability, and the illusion of control. I've owned an unreliable car (It had trouble starting, but would run fine once started). It sucked. Not knowing if the car would start each time changed my relationship with going places and doing the things I wanted to do. I had to budget extra time everywhere I went, in case I needed to jump the car or wait for AAA. On-demand cars will have many of the same problems, just due to demand surges, and traffic. Sure, you can get stuck in traffic any time. That's true, but you feel it less when you have the illusion of control of driving. When the traffic delays your inbound car by 5 or 10 minutes and you're just standing on the curb waiting for it, that feels more aggravating than when you're behind the wheel.

I also think there will be a significant fraction of the population that uses their car as personal, daily storage. My wife keeps a bunch of stuff in her car, and would be significantly impacted if she had to take it all in and out every time she went everywhere. Same thing with kids car seats, etc.

I think on-demand cars will probably replace second commuter cars for families, but there will still be many, many owned-cars as well.

That's a really good post and I agree that if the only added-demand is for people like me (btw, I am someone who only wants something to get from A to B with present cars) then that cannot possibly outweigh the likely large cost differential for the many many people who find cars difficult to afford.

I'm sorry for communicating poorly, but my point was more that it is not likely possible to predict all the consequences of a completely new technology and how behavior and economy will change in response. And I'm not even predicting anything myself about demand (beyond my own desires, which is dicey enough to predict) -- I am just curious where the confidence comes from when people state that ownership will be significantly reduced as an obvious fact when IMO that is certainly plausible but I don't have any reason for such confidence.

I don't think self-driving in and of itself will decrease ownership, but the combination of self-driving, flexible car sharing services, and ubiquitous ride sharing services will continue to make car ownership undesirable.

A car in a driveway or parking spot has horrible utilization rates. Ownership of things like cars has never actually made sense, given that they depreciate in value as soon as you drive it off the lot.

Meanwhile, more and more OEMs are moving into the car sharing space, and I think that will scratch the itch of wanting to drive a car for fun, or utility (need to pick up something large or be some where at a specific time).

One part of the answer is the prediction that ownership will move from personal ownership to fleet ownership.

There is also a factor that those predictions do not seem to be factoring in: That the need for a car is concentrated at commuter hours in the morning and afternoon. So the sales reductions will be tempered by the fact that many cars will be needed simultaneously.