Following the stock prices and industry valuations in the auto business can be an exercise in futility, not to mention an exceptionally dull experience without much reward.
The numbers, though, can provide an interesting glimpse into the trends, and the possible future, of the automotive industry.
An article at CNN Money dives into the dismal May sales numbers automakers have reported and their effect on stock prices. Other factors, including increasing fuel prices and automotive scandals, are contributing to slower sales.
All of this to say that, in addition to individual auto sales, automakers need large companies to purchase fleets of vehicles to help boost their numbers. One of the largest, and potentially one of the last, companies likely to purchase large numbers of cars is ridesharing startup Uber.
The irony here goes beyond measure.
Think about this: The rise of Uber in large cities has made more people question traditional car ownership. Automakers suffer when people don’t buy cars. Uber needs cars to provide rides, so automakers could begin to rely on the very company responsible for fewer sales to help increase sales.
It’s a mind-bender, isn’t it?
Even the country of Saudi Arabia is seeing the potential of Uber and has invested $3.5 billion in the startup, signaling the country’s desire to move away from its dependence on oil.
Finally, there’s this:
Uber’s private market valuation remains $62.5 billion. That makes it the world’s most valuable unicorn … aka startup. At $62.5 billion, Uber is also worth more than GM, Ford and Honda.
Somehow, a startup ridesharing company has quietly surpassed the world’s largest automakers in value. For the last 100 years, the auto industry has relied on gasoline, individual drivers, and car ownership. The future of automobiles looks to be electric, autonomous, and shared.
Uber is leading the disruptive charge and automakers (and oil producers) are being forced to listen and conform.
If that’s not a sign of a monumental shift in the auto industry, I don’t know what is.
Has Uber or another ridesharing service changed the way you view car ownership?