[lbo-talk] One Car Families on the Increase

Steven Robinson srobin21 at comcast.net
Fri Oct 30 22:00:12 PDT 2009


Valley couples shed autos, turn to mass transit

by Sean Holstege The Arizona Republic Oct. 30, 2009

When Tony Bowman moved to Phoenix from Chicago 18 months ago, he had a job. His wife, Joan, didn't, and she couldn't have picked a worse time to look for work as an interior designer - she's still unemployed.

So, with about half the income, the couple got rid of one car and bought a home near a light-rail station.

"We went from a two-income, two-car family to a one-income, one-car family," said Tony, 40.

Although he runs the Valley Metro department that aims to reduce solo driving, Tony Bowman said he and his wife would have become a one-car family even if he worked somewhere else.

"The decision was economically driven," he said. "When we got here, the economy went into the toilet."

The Bowmans belong to a growing group of people giving up their status as a multicar household.

Increasingly, Arizonans anxious over the economy are changing how they get around, either switching to carpooling or using mass transit, state and Valley transportation officials say.

Statistics clearly show that families trying to make ends meet are reducing their driving costs and that selling off the second car saves on repayments, insurance and maintenance.

It's still too early to tell how widespread the trend toward one-car families is. But the lease market provides the strongest indication that it's growing.

The nation's largest online service for swapping car leases, LeaseTrader.com, reports that the number of clients abandoning their leases to become one-car families has tripled in the past year. The company helps people get out of leases early by matching them with someone willing to take the car off their hands for a small fee and lower payments.

Arizona, it says, is one of the hot spots.

LeaseTrader said it helped 3,500 families nationwide become one-car households in the past year. Of those, 420, or about 12 percent, were in Arizona, a significant figure for a state that represents just 2 percent of the U.S. population.

The majority of the leaseholders seeking to become a one-car family - 389 in total - were unemployed, the company said.

"This is an unemployment problem that's been around for awhile," company spokesman John Sternal said. "People are desperate to cut their bills in ways they never expected."

Other Sun Belt areas with foreclosure meltdowns, such as Southern California and Florida, have seen similar trends, Sternal said.

"We saw a lot of foreclosure clients," he said. "These were people who were living beyond their means and leasing nice cars."

Larry Carver of Chandler turned to the online service because he could no longer maintain his consulting business. He moved to the Valley from the Seattle area in 2008 to design tools for the aerospace industry until he retired.

When the economy collapsed, his biggest clients started doing that work in-house. He lost half his business, he said.

So, Carver closed his Washington office and canceled the lease on his wife's BMW SUV. He couldn't justify paying $900 a month to keep and insure the car. The couple now share a leased BMW 335.

"We leased the two cars in 2007 because the business was going well. We were going to buy the cars at the end of the lease, and they were going to be our last cars," the 64-year-old Carver said. "Things got really slow, so we decided it would be better to retire."

Other data also shows the state's car owners are changing their habits to save money.

Since the 1970s, the number of car registrations had been growing faster than the population in Arizona. Two years ago, registrations slipped for the first time, reversing the historical trend.

Arizonans have bought less gas and registered fewer vehicles. At the same time, transit ridership has climbed to all-time highs and the proportion of insurance policies written for one-car households has increased.

Combined, the trends point to more motorists choosing to give up their car.

In late 2008, the number of passenger cars registered in Arizona fell for the first time and continued to decline in 2009. The number of registered cars slipped from 3.44 million two years ago to 3.42 million in September, the latest state Motor Vehicle Division data shows.

Gas sales in Arizona also fell 11 percent during that time.

In 2008, Valley transit systems reported record growth in the number of passengers they carried. Initially, the shift was attributed to $4-a-gallon gas prices, but it continued after gas prices abated. The percentage of commuters who drive to work alone has slipped during the recession, according to Maricopa County's Regional Public Transportation Authority.

AAA of Arizona says the percentage of single-car auto policies it wrote statewide climbed from 45 percent to 55 percent from June 2008 to June 2009.

State Farm Insurance Co., one of Arizona's largest carriers, has seen no change in three years in the number of policies for one-car families, spokesman Gus Miranda said.

For the Carvers and the Bowmans, adjusting to a one-car lifestyle hasn't been a burden.

"It comes down to cost and planning," Tony Bowman said. To get around, he said, they "try to do everything in one trip."

"It costs between $6,000 and $9,000 to run a car each year," he said. "Not having it is like a pay increase."

http://www.azcentral.com/business/articles/2009/10/30/20091030biz-onecar.html?source=nletter-business

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