
Oil Demand for Cars Is Already Falling - jseliger
https://www.bloomberg.com/opinion/articles/2018-11-16/oil-demand-for-cars-and-transportation-is-already-falling
======
credit_guy
The article tries quite hard to link the falling demand for oil to the
emergence of electric vehicles. But looking at the reduction in half of the
usage of gasoline in Italy, I see that basically all of it happened prior to
2013, long before Model 3 was a thing.

I found this interesting site [1] where you can see the gasoline consumption
for every country between 1991 and 2012. And all big EU countries I looked at
(Germany, France, UK, Italy) exhibited a steep decline between 1999 an 2012.
This can't have anything to do with electric vehicles. Most likely it's the
continuous improvements in car efficiency.

To check this I went to edmunds.com [2] and I compared the same car between
the 2004 and 2018. Here's what I got for the highway mileage for 3 random cars
(in all cases I looked at the most basic model):

\- Mazda 3: 2004: 29 mpg ; 2018: 37 mpg

\- Toyota Camry: 2004: 29 mpg; 2018: 39 mpg

\- Ford Explorer: 2004: 19 mpg; 2018: 23 mpg

That's an improvement between 21% and 34%. Not bad at all.

[1]
[https://www.indexmundi.com/energy/?country=de&product=gasoli...](https://www.indexmundi.com/energy/?country=de&product=gasoline&graph=consumption)

[2]
[https://www.edmunds.com/mazda/3/2017/sedan/](https://www.edmunds.com/mazda/3/2017/sedan/)

~~~
bufferoverflow
Recently got a Toyota Verso, and was shocked to find out it averages 62.8 mpg
[1]. And it really is that efficient.

[1] [https://blog.toyota.co.uk/honest-john-honours-toyota-
verso-f...](https://blog.toyota.co.uk/honest-john-honours-toyota-verso-for-
best-real-world-mpg-performance)

~~~
osrec
Even my newish bottom-of-the-range Mercedes e-class will do close to 60 mpg on
the motorway. Compare that to the previous model from 3 years ago, which was
giving around 50mpg, and from 10 years ago, giving under 40mpg.

The newer models feel lighter and more nimble. Almost as if they've got rid of
a significant chunk of their unneeded, inefficient components from under the
hood and replaced them with something radically different.

~~~
GoToRO
They replace everything they can with plastic.

~~~
Tempest1981
And aluminum, instead of steel, for hoods and body panels. Even rugged pickup
trucks are shedding weight.

~~~
DenisM
F150 lost 700lb in transition to aluminum structure.

------
partiallypro
I think falling demand has a lot less to do with electric cars and more to do
with the MPG in cars going up and people finally buying newer cars. Electric
car penetration in the US is not high enough to have a massive impact, but
MPGs going up and newer models of cars getting on the road can have a massive
impact.

When it comes to electric vehicles, the question won't be oil, it will be the
supply chain still being very polluting and China having a massive foothold on
lithium supplies.

~~~
yawz
_> buying newer cars_

And unfortunately changing cars too often has a significant environmental
cost. I think making of the car has as much as 50% of its average life-time
carbon footprint. So buying a newer car may be increasing the MPG, but brings
in a huge upfront environmental cost.

~~~
guntars
Producing a gas vehicle is equivalent to two years of average driving as far
as carbon footprint is concerned, according to this one guy on YouTube
([https://youtu.be/6RhtiPefVzM](https://youtu.be/6RhtiPefVzM))

------
rsync
Here is everything you need to know about the demand for autos and the
psychology of the auto consumer in the United States. Also very instructive
about attitudes toward public transportation in the US.[1]

This video is worth one million words:[2]

[https://www.ispot.tv/ad/wy2O/state-farm-backstory-truck-
song...](https://www.ispot.tv/ad/wy2O/state-farm-backstory-truck-song-by-john-
taylor)

What is depicted in the video is considered, by much of the United States
population, _to be their birthright_. The tax or incentive regime that would
be necessary to prevent every young male from buying a _huge truck_ [3] would
be a bigger political impossibility than banning firearms.

I note that General Motors just reintroduced 0% financing for trucks.

[1] ... which is well deserved. Bus transit in the United States is terrible.
In most municipalities, there is no other option.

[2] A state farm (insurance company in the US) commercial that was aired in
the past year during American football (not soccer) games.

[3] If you don't live in the US, you have _no idea_ how enormous the vehicles
are that individuals are using to drive their single persons to the grocery
store. It is very common to see a 7 meter long vehicle that is rated to tow an
8 horse trailer (or a yacht) being driven, with no cargo, and a single
occupant, to run errands around town.

~~~
martythemaniak
Great link, that video really does pack quite a lot of cultural context in a
short time. If you're not from the US and understand each second of that
video, you'll understand quite a lot about other things that happen in
America.

I'm quite interested to see how Tesla's pickup truck does in this market. On
one hand, it can be a total flop, because as you pointed out, huge swathes of
this market exist because men need to acquire and exhibit their "masculinity"
(as they understand the concept). Burning fuel and making noise seems to be
one of the core components of this "masculinity". Coal Rollers simply take
this to it's logical conclusion.

On the other hand, maybe its other attributes (0-60 times, towing capacity,
size, technology, price) can be sufficiently better to overwhelm this "burning
fuel and making noise" aspect and become a well-selling truck. Maybe buying a
ridiculous 6-seater, $80k+ EV pickup will be how you update this "masculinity"
while distancing yourself form the coal rolling assholes.

~~~
rsync
"I'm quite interested to see how Tesla's pickup truck does in this market."

I wasn't aware that Tesla had a pickup truck in the pipeline...

On the platform side, the skateboard chassis design and its low center of
gravity along with AWD achieved with multiple engines, etc. - there's a lot to
be excited about there.

However, the UI/UX is getting weirder and weirder and I have a hard time
imagining that serious workers/contractors/fleets are going to embrace a big
touchscreen and no physical controls and no physical dials behind the wheel,
etc.

I think a much better outcome would be a Tesla licensee who could concentrate
solely on the professional truck market.

------
ToFab123
Think of an item, that you're purchased within the last couple of years, that
was not made from oil but was manufactured in Russia. Ok, I wait. You can't
think of any? OK, then what about from of the Arab speaking countries? Yes. I
can wait. Take your time.

I hope those countries have a plan B for when the majority of the world's car
run on something else than oil.

~~~
jsrn
Does software count as an 'item' for you? If yes, for me (and I guess many
others here) it would be various products of JetBrains, also Kotlin (even if I
did not pay for that one directly) and OCR software from Abbyy. Also did not
pay for, but use daily: nginx.

~~~
Tade0
JetBrains are Czech, not Russian.

~~~
projektir
IIRC they're headquartered in CZ, but the developers were mostly in St.
Petersburg, and Kotlin is named after a Russian military island.

------
jorblumesea
Interesting anecdote: Alan Mulally (former ford ceo) greatly increased fuel
mileage in SUVs due to his work in the aerospace industry (Boeing). He knew
aluminum well and pushed for adoption of aluminum bodies instead of the
traditional steel bodies. This shaved something like 600lbs off the weight of
the trucks and contributed to significant MPG increases. F150s get 26 MPG
highway, an almost unheard of efficiency 10 years ago for trucks. As recently
as the early 2000s, 4 door passenger vehicles averaged around these efficiency
levels.

You don't need electric vehicles to cut oil demand. This is just one example
of many moves the industry is making.

~~~
anoncoward111
Can confirm, my 2003 jaguar xtype got 17 mpg! Awesome engine noise, and not
much else. Purchase price is down payment on first repair.

~~~
tonyedgecombe
_Purchase price is down payment on first repair._

This has always been a problem for Jaguar, I wonder why they have never been
able to get a grip on it.

~~~
anoncoward111
I think they were just very content to not care about it. I imagine they were
making money selling replacement parts or upselling new Jaguars every 3 years
:\\\\\\\

Personally I thought the shape of the X Type and S type was nasty, but loved
the engine. Mine was sold to scrap when the reverse gear blew one day-- don't
try to force the shifter into reverse if it won't let you for some reason.

The 70s XJS is a really cool body style and anyone with a lot of time, money,
and or skill on their hands would be really wise to just knife a crate engine
into it somehow and get all the reliability that Jaguar mechanical bits have
never delivered, ever :)

------
asaph
On the subject of accelerating the transition towards sustainable energy, Elon
Musk recently said:

> Without Tesla, ... There would still be a transition to sustainable energy,
> but it would take much longer. History will judge this, obviously, but I
> would say on the order of 10 years, maybe 20 years.

Source: [https://www.recode.net/2018/11/2/18053428/recode-decode-
full...](https://www.recode.net/2018/11/2/18053428/recode-decode-full-podcast-
transcript-elon-musk-tesla-spacex-boring-company-kara-swisher)

~~~
adventured
History will judge that Tesla's competitors made an extraordinary mistake in
waiting 15 years to try to directly compete with Tesla in EVs. At the rate
they're going they'll get to $50b in annual sales before most of the auto
majors each have even a small fleet of EV vehicles available for purchase.

~~~
curuinor
Nissan makes more EV's than Tesla by a bit.

~~~
tigershark
It’s totally false. Model 3 sales are about 15 times greater than leaf sales
in the last months.

~~~
Markoff
maybe in us, but herehere i can hardly see Tesla while police sometimes and
public drive leaf and there are few small electric BMW, talks outside
us/Norway doesn't really exist

~~~
tigershark
Model 3 is sold _only_ in US and Canada, so I would be rather surprised if you
saw it elsewhere.

------
medion
Has anyone written about, or documented how the ancillery ICE industry has
coped in high penetration EV countries (Norway for example)?

I.e what has happened to all the mom and pop exhaust shops, transmission
shops, service centers, local mechanics, etc etc. Have they just packed up and
left? I'm really curious how this has played out in countries where adoption
has happened fairly rapidly.

------
perpetualcrayon
Some folks I've talked to disagree but I think not an insignificant reason is
ubiquitous usage of GPS and the internet (knowing precisely where to go and
how to get there in the most efficient way possible).

EDIT: and then I figure another leap was the convergence of the two.
gps/internet on cell phones.

~~~
lucidguppy
You mean not getting lost is causing more efficient travel?

~~~
kodablah
Or increased availability of traffic information allows people to avoid it
easier by waiting or changing routes.

------
akeck
Some SUVs with 4-cyl engines and CVTs get equal or better mileage then late
90s commuter cars.

~~~
ip26
Which, given the last twenty years of fairly impressive engine technological
advancement, is in some senses a travesty.

~~~
Nasrudith
Reminds me of looking at the Volkwagen Beetle's MPG as a timeline and how it
sadly started getting worse over time despite having a respectable 30s decades
earlier.

~~~
CydeWeys
Isn't that because they got heavier (better safety features and structural
integrity) and got more powerful engines? The original design can barely cope
with modern highway speeds, with dangerously slow acceleration, and if you get
into a crash at those speeds, you're dead.

~~~
ip26
All generally true statements, but we've taken it pretty far. The average
vehicle weighs something like twice what it did thirty years ago, and where
40hp used to be adequate fifty or sixty years ago, and 120hp could be "sporty"
thirty years ago, many modern cars with less than 200 horses are described as
underpowered today.

Tangent, _" can barely cope with modern highway speeds"_, well, why does the
highway speed limit _have_ to be 65mph or 75mph or 80mph anyway? People got by
when it was 55mph. Now, I'm not calling for the return of 55mph, but I'd like
to point out that highway speeds are not natural law. Raising them was a
choice- a choice that was one of many small pieces to arriving at where we are
today, that is to say without much improvement in fuel economy.

~~~
Nasrudith
Highway speeds are also a bit of an arms race in themselves. The danger is in
when you can't accelerate as expected compared to everbody else. Since 70s
'muscle cars' now have worse zero to sixty acceleration times than modern
econoboxes who aren't even making it a priority. Just having a sweet sports
car that floor it to sixty in fractions of a second isn't a danger in itself
so long as used /safely/. It is when everybody does it that having an old
junker that can't starts to become a bit of a hazard and congestion issue due
to having to wait for bigger gaps.

It is a bit of a matter of conventions akin to driving on the left or right
side of the road - while there may be some fringe situational benefits in some
circumstances it really doesn't matter what you do so long as everybody does
the same thing. In a bit of irony unusually following the law when few others
do can itself create bits of hazard.

------
chiefalchemist
Did I skim too fast? I didn't see any mention of where this electricity is
coming from. Is it solar? If so, what countries / companies stand to benefit
from this shift? Presuming the new boss is not the old boss (i.e., the oil
producers in the Middle East), more importantly, what will this do to the
socio-political power structure in oil producing nations?

p.s. The USA is also a top oil producer?

~~~
diafygi
Renewable generation (solar, wind, geothermal) is usually made in-country.
However, fuel-based generation (coal, natural gas, nuclear, oil, etc.) has
fuel that can be shipped or piped in if you don't have a source for it
locally.

So in general, the "electrification of everything" along with cheaper
renewables and storage will likely push countries towards more "energy
independence" than currently.

~~~
chiefalchemist
Also, what is the impact / risk of putting more eggs in less baskets? That is,
for better or worse, gasoline is a distributed system with plenty of
redundancy, at least at the pull up to the pump level.

But if the power grid goes down (e.g., cyber terrorism / cyber warfare), then
so does your vehicle.

Don't get me wrong, I'm certainly in favor of cleaner energy. However, it does
also change the overall nature of the game. It's not simply swapping one souce
for another.

------
nimbius
speaking as an automotive mechanic by trade, other HN posters are right to
point out this is largely due to advances in fuel economy. Id argue it wasnt
hard for this reduction to occur, as the super-large SUV fetish from the 90s
has long died out. most of the new rolling stock of large vehicles are
crossovers, or hybrid.

another key point is oil recycling. most of the new oil put into engines is
recycled with 15-20% new stock at best. the really old stuff that can no
longer be refined after use is either blended for use in asphalt or recycled
plastics.

~~~
CydeWeys
> the super-large SUV fetish from the 90s has long died out.

Are you sure this is true? I believe the size of the average American new car
is the largest it's ever been. Sedans and station wagons have been replaced
with SUVs and trucks. Hell, Ford's barely even making cars anymore, just SUVs
and trucks. More info here: [https://www.cnbc.com/2018/04/06/the-steadily-
disappearing-am...](https://www.cnbc.com/2018/04/06/the-steadily-disappearing-
american-car.html)

I suppose that you were referring to Hummers, but they were only ever a tiny
portion of the market. The rest of the market, however, has been steadily
transitioning to larger vehicles ever since.

------
nozfud
We need to ban production of fossil fuels immediately. Tax the sale of
reserves so that people can’t afford to depend on this existential threat for
daily life. Subsidize the production of green electricity and fund the
transition to a fossil-free world. If the market can’t handle this,
nationalize whatever industry nessecary and bring under a central plan to
accomplish the goal. The alternative of runaway climate change is far worse.

~~~
edejong
It is hard to disagree with your sentiment, but to get the discussion going,
it helps to complicate your position somewhat:

\- who is 'we'? The policy-makers? The voters? They voted a climate-change-
denier into the presidents chair. Not fair? Should've listened to those fear-
mongerers telling you to stop using Facebook as a source of news.

\- how to deal with the global economy? There is no 'central' plan. Funding
green energy will just shift the balance to other countries.

\- who is going to produce so many electric cars in such a short amount of
time? Without transportation, you will risk civil unrest.

\- how would you produce steel? How to prevent movement of steel production to
developing countries?

\- how will you transform the agricultural industry? Even if you start now,
the transition to 0% fossil fuel usage will take at least a decade. The supply
of lithium and the battery production capacity are simply too low.

\- if you subsidise green energy, you will also promote the inefficient
production of the goods necessary for this new market. The inefficient
production can and may happen oversea, causing you to just shift the problem
to China or elsewhere.

\- "the alternative of runaway climate change is far worse". You cannot
influence the global markets. If the nationalisation/taxation will cause civil
unrest and an illegal usage and trade in fossil fuels, the alternative might
be better! At least the (legal) usage and trade is subject to international
oversight.

------
User23
For reference, estimated daily oil consumption in 2018 is 99 million barrels:
[https://www.statista.com/statistics/271823/daily-global-
crud...](https://www.statista.com/statistics/271823/daily-global-crude-oil-
demand-since-2006/)

------
spikels
Title: Oil Demand for Cars Is Already Falling

2nd Paragraph Text: Oil use for cars peaks in the mid-2020s...

Ugh!

~~~
neolefty
Read farther — that's quoting a 2016 report that is already proving obsolete.
The article continues, contradicting that very report:

> But demand for oil consumed for transportation is already waning in certain
> markets and segments.

------
alacombe
In the mean time, France is about to see nation-wide grassroot demonstrations
all over its territory over fuel tax, highlighting the disconnect between
cities and urban area.

ICE vehicles are not going to the junkyard anytime soon.

~~~
MRD85
How bad is their fuel tax? In Australia we have huge amounts of tax on fuel
but I've always known that as normal.

~~~
alacombe
About USD6.33/gal, or AUD$2.3/l for diesel, about the same now that gasoline,
though there was larger price difference in the past which lead a lot of
people to get a diesel car, so these folks have been hit hard. It's about
twice the price as here in Canada.

~~~
ianai
I’ve see. Articles suggest that’s 3-4 times smaller than the social cost of
abating the societal costs of burning fuel. Pretty sobering to think how
different the world would be if that price were charged to the burner of fuel.

------
known
Relevant
[https://news.ycombinator.com/item?id=11879869](https://news.ycombinator.com/item?id=11879869)

------
dingoegret
Producing electricity still demands oil. Even 100% naturally generated power
requires tons of oil to lubricate generators and moving parts.

~~~
meggar
Solar has moving parts?

~~~
cesarb
Yes, at least on my country most solar power plants use single-axis trackers.
The increase in capacity factor makes it worthwhile: on the 12 months up to
this September, the highest average capacity factor for fixed solar power
plants was barely above 20%, while for single-axis trackers it got to nearly
30% (source: ONS monthly solar generation report).

------
sgt
I was about to say.. the oil demand for my old car seems to be increasing.

