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The Effect of Ride-Sharing on the Auto Industry

Ride-share technology, facilitated by universal smartphone penetration, has decimated the taxi industry; meanwhile, coincidentally, carmakers have enjoyed record sales. In this article, we consider some possible longer-term ramifications of ride-sharing for the broader auto industry. Rather than declining sales volumes, as many pessimists have predicted, the biggest threat seems instead to be increased vehicle homogenization. This holds the potential to radically affect the profitability of new vehicle manufacturing and the viability of the used car industry in general.

Many in the auto industry are concerned about the impact of ride-sharing. Opinions related to the issue typically fall into one of two camps. First, there are the “technology optimists” who imagine ride-sharing companies with fleets of self-driving cars dominating the highways next year. Others point to various regulatory and technological issues that are likely to slow progress toward this brave new world.

The objective of this article is to analyze the impact of ride-share services like Uber and Lyft on the private transportation market. For dealers, financiers, and manufacturers, the volume of car sales is a critical determinant of financial success. Assuming a constant mark-up in either the new or used car market, industry profits will be dictated by the number and dollar volume of retail sales ultimately made to consumers or ride-sharing companies and contractors. Forces that erode industry pricing power are also a critical concern. We will explore both issues.

Since ride-sharing has only existed for a short time, it is probably too early to empirically identify any structural break that may have occurred as a result of the new technology. For this reason, we will adopt a more theoretical approach, and a simplified economic model will be sketched out. We will then relax some of the assumptions in our framework and consider the effect on volume and pricing.

For simplicity, assume there is only a primary (new vehicle) market for cars. In other words, vehicles are purchased new and then “driven into the ground” by their homogeneous owners. Assume further that the number of private journeys undertaken by society is fixed and that taking one journey in a homogeneous private vehicle causes one unit of physical depreciation. Assume all cars are driverless.

If a consumer simply chooses to substitute a journey taken in his or her own car for one taken in a ride-share, the total amount of vehicle depreciation suffered by society will be unaffected.

Now, let’s say that one ride-share vehicle replaces 10 cars that were previously privately owned and spent 90% of their potential driving time garaged. Under our assumptions, the total number of depreciation units is unchanged, but the units are now concentrated in one-tenth as many vehicles as observed under the status quo. If the vehicles in question have a fixed lifetime, consistent with the assumption of vehicle homogeneity, the ride-share cars will depreciate to scrap value 10 times faster than equivalent privately owned vehicles.

5 Ways to Avoid Collisions This Summer

Summer is by far the busiest period of the year on the roads and more accidents occur during the summer than in any other time of year. Let’s all try to be safer this season and follow this guideline of five ways to avoid collisions this summer.

This time of year is when students are out of school, families leave on vacation and young people go on road trips; there are holidays, parties, weddings and weekend getaways. Almost 30% more car accidents happen in June, July and August and, from Memorial Day to Labor Day, there is a spike in fatal car collisions involving teenagers. In Pennsylvania, June is often the month with the highest number of deadly collisions.

Summer heat means cars are more likely to have mechanical problems, overheated engines and tire blowouts. You are also more likely to encounter road construction and maintenance work during this season.


During the summer cars are subjected to additional stress because of the heat. You can decrease the risk of a breakdown or a collision by getting your vehicle tuned up now.
Summer sun ruins the rubber on windshield wipers; if they’re already in bad condition, have them replaced. Dusty road conditions can choke up engines and decrease engine efficiency and cause damage so we also recommend getting the filters checked. You should also get the oil changed and fluids refilled.

Because high temperatures increase the occurrence of tire blow outs, this is a good time to have your tires rotated and check the tire pressure and treads. Try the penny test to see if your treads are worn down or unsafe. If your tires are bald, don’t wait until the winter to change them as hydroplaning in a summer storm is just as dangerous as driving on snow and ice.

Brakes and brake pads are imperative; they should be inspected regularly, not just in the summer. You’ll also want to generally look over the car and make sure headlights, turn signals, brake lights and any trailer equipment for towing a camper or boat are all working properly.

If your vehicle hasn’t been serviced recently, or you don’t know its service history, schedule a maintenance check with your mechanic as soon as possible.


With more drivers on the road, summertime can be more dangerous than it seems. Limiting distractions becomes even more important in order to prevent accidents. By focusing on the road, you can predict hazardous situations and give yourself time to safely avoid them.

Make any phone calls, send texts and program your navigation app before starting the car. Be aware that eating, adjusting the air conditioning and arguing with passengers can all be sources of distraction. It’s always better to pull over rather than trying to do other things while driving.

For many car owners, insurance can seem like a tricky thing. It’s not always clear what type of insurance you need, what your policy covers or how to get damage from accidents repaired. Comprehensive and collision are two kinds of auto insurance that protect drivers in different ways.

The Difference Between Comprehensive and Collision Auto Insurance

Comprehensive and collision insurance do have a few things in common.

Both types are optional. State laws don’t currently require either comprehensive or collision coverage.

They can be purchased separately or together.

Coverage usually applies to the vehicle, not the driver, with the exception of rental cars.

The maximum amount of damage covered is the actual cash value (ACV) of the car once the deductible has been subtracted.

Most policies will require a deductible.

Most people want to know how comprehensive and collision insurance differ, however. To decide which kind of auto insurance is right for you, carefully review the options available. Be sure to also review the common myths and facts about insurance coverage.


Arizona requires drivers to have car insurance that meets or exceeds the following minimum coverage levels:

10 Steps to Follow After A Collision

When you get into a car accident, it’s easy to sink into panic – especially if you’ve never been in an accident before. With your adrenaline and nerves at a high, you may not be able to think straight. After you realize you’re okay, you will find yourself reaching for your phone, and when you do, we hope that these guidelines can be of some help to you. Here are our 10 suggested steps to take after an auto accident:


If you can, keep your vehicle exactly as it is at the accident scene. If you are in the way of traffic, and it’s best to move your vehicle out of the way, be sure to take photos before doing so.

In most states it is required by law that before you can leave the scene of an accident, if anyone is injured, or there is any significant property damage, the local authorities must be notified. It’s a mistake to just exchange names and phone numbers with the other driver and leave the scene.

If you’re involved in a car accident, you should take photos of the following:

Having your vehicle painted is an undertaking that can bring a lot of satisfaction. Not only will your car look like new, its exterior durability can be significantly enhanced. Choosing to have your vehicle repainted also requires an investment of money and time.

Before bringing your vehicle to a paint or auto body shop, take some time to get the facts. Understanding what the painting process entails makes it easier to choose whether or not to have your vehicle repainted. Armed with the facts, you can make a more informed decision.

5 Facts to Consider Before Getting Your Car PaintedPainting a Vehicle Takes Time.

New Paint Won’t Fix Everything.

Car Painting Prices May Vary.

Painting Adds Value.

Painting Requires Removing the Car’s Interior.

Some vehicle paint shops boast a turn-around time of three days or less, but in general, you should expect your car to be in the shop for at least a week. Why does it take so much time for the car to be repainted? New paint cannot be applied directly to old paint. The fading, oxidation, and irregular surface of a vehicle’s existing paint does not allow for the smooth application of a new coat. Removal of the existing layers of paint and other prep work must be completed before new paint can be applied. If a car requires extensive prep work, it will also raise the total price for the paint job.

It’s important to have realistic expectations with repainting or paint repair. “Sometimes new paint has the opposite effect,” says Brandon Badell, owner. “If you want to paint over damage without fixing it properly, a fresh coat of shiny paint can actually highlight problem areas.”

For the best results, the auto body shop should first remove the old paint on the car and fix any damage that is present. Damage can include:

Top 10 Father's Day Gifts for the Car Lover in Your Family

Don’t forget dad! Father’s Day is on June 16th – that’s just around the corner. In many families, though, dad is the toughest one to buy gifts for. If you’re looking for just the right gadget for your father, we have put together a list of the top 10 car accessories that make great gifts.

Dashboard cameras can help while parking or to catch video footage of an accident. Though they are not a standard feature even on luxury model cars, these gadgets can be super handy. With the YI Mirror Dash Camera, dad can turn his rearview mirror into a dual dash cam with touchscreen controls. It delivers live, high-quality video from front and rear cameras mounted on the car so he can easily keep an eye on traffic in every direction. The YI Mirror Dash Cam has sensors that automatically activate the cameras in case of an accident and backs up the video data. It also has a few of other safety features and is available for just $69.

Alexa’s voice-activated service can now be used while driving. With the Roav VIVA car charger, your dad can ask for directions, make hands-free calls, listen to podcasts, play music from his smartphone, and more, on command. It works with Android and iOS smart devices. Plus, this gadget provides two USB charging ports and a mute button to turn Alexa off. You can find this gift for just $59.

HUD devices have made it possible to integrate a smartphone with a vehicle. High-tech fathers will love the ability to see the screen of their mobile from the driver’s seat without taking their eyes off the road. And now, devices like the Hudway Cast, make it possible for any car to have what now comes standard on many luxury models. The head-up display sits on the dashboard and wirelessly projects the phone’s display in front of the windshield. Dad can see incoming calls, use the map for directions and select music from his phone without being distracted. Buy this Father’s Day present for $189.

Dad doesn’t have to settle for gas station coffee anymore; get him the Handpresso Auto Capsule. For joe on the go, it fits the vehicle’s cupholder and charges via the 12/24v cigarette lighter. In less than three minutes, he can enjoy a hot cup of gourmet espresso! This gift costs about $160.

This gadget keeps the phone in place and charging while dad drives. The Vanmass Car Charger serves as a mobile phone mount and convenient wireless charger. It’s compatible with most smartphone models and can be mounted on the air vent of any auto. The arm holds it steady and is adjustable for best visibility. This product can be purchased for less than $50.

Interstate Batteries | 5 Questions to Ask Yourself When Buying a Car

So what questions should you ask yourself before you go in to buy a car? If you're trying to ring in the new year with a new ride, then you'll want to consider these five things when making this big decision.

1. Should I buy a new or used car?
The age-old question of new or used. Well, there’s not a one-size fits all answer to this question. With a new car, you can have peace of mind that everything is covered by warranty and you’re the car's first owner. While used cars may not have the same sense of peace, you can typically get a better deal by going the used route. Ultimately it comes down to what you prefer.

2. How much do I want to spend on a car?
We recommend sitting down before going into the dealership, to figure out what your budget is for a car. Then you know your max price and can make sure you’re not committing to something you can’t keep up with in the long run. And don’t forget to include the trade-in value of your current car!

3. What kind of car do I need?
Sportscar, minivan, SUV, sedan. There are a lot of options and more than one right answer. Will this car mostly be used for your daily commute or will you be using it to take the kids to soccer practice? While you may want that sportscar so you can be the cool dad when you pick up your kids from school, a minivan might be the more practical choice.

Don’t let a dead battery hold you back from living your best life.

There are a lot of uncontrollable factors that determine how long your battery will last. Things like weather, driving habits and age can impact how long your battery will run, but we’ve got four tips to help you extend the life of your battery so you don’t miss any of life’s important events.

Interstate Batteries | 4 Ways to Help Extend Your Car's Battery Life1. Regular Battery Maintenance*

Battery maintenance is the key to keeping your battery healthy and strong. During regular maintenance, be sure to check the water levels on your battery. Also make sure that you check the connectors and hold downs for proper tightness. You also may need to disconnect your battery to keep it free of corrosion. Our pro tip is to clean the battery using a mix of baking soda and water. Mix the two ingredients to the same consistency as toothpaste, clean the battery with the mixture, rinse with water after clean and then dry thoroughly.

2. Be Mindful of Car Accessories

We all know that leaving your headlights on when your car is off can drain your battery, but running other accessories can be a drain too. It’s best to make sure your interior lights, radio, and windshield wipers are off when the engine of your car is no longer running.

WASHINGTON, June 11, 2019 -- U.S. News & World Report, the global authority in rankings and consumer advice, today unveiled the list of June's Best New Car Deals. This month's list includes eight vehicles with excellent financing or cash back incentives. U.S. News also provides June's Best Lease Deals and Best Used Car Deals.

"This is the first summer in a long time where consumers have been in the driver's seat as the demand for new cars slows," said Jamie Page Deaton, executive editor of U.S. News Best Cars. "We're seeing plenty of good deals on popular models, including the Ford F-150. You can even save big at the other end of the automotive spectrum, with some incredible cash back on the Chevrolet Bolt EV."

U.S. News Announces June's Best New Car DealsJune's Best New Car Deals

2019 BMW X1


0.9% financing for 60 months

2019 GMC Sierra 1500


0% financing for 72 months

2019 Chevrolet Bolt


Up to $4,000 cash back or 0% financing for 72 months and $1,250 cash back, depending on region

Summer Savings at the Pump as Retail Prices Drop Seven Cents on the Week

Nearly every state’s gas price average is cheaper than a week ago, a month ago and a year ago. Today’s national average is $2.74, which is seven-cents cheaper than last week, 13-cents less than a month ago and 18 cents cheaper than a year ago.

“Refinery utilization in the United States is at its highest level since early January, resulting in overall gasoline stocks at healthy levels to meet robust summer demand. Prices are dropping due to cheaper crude oil and at the same time U.S. supply is keeping pace with demand,” said Jeanette Casselano, AAA spokesperson. “The national average is poised to fall to at least $2.70 this week – an indication that pump prices may be even cheaper this summer.”

For the last three weeks demand has remained relatively robust at 9.4 million b/d. Meanwhile, gasoline stocks have increased weekly with total inventories at nearly 4 million bbl ahead of the five-year average, according to Energy Information Administration (EIA) data.

Quick Stats

The nation’s top 10 largest weekly decreases are: Ohio (-21 cents), Indiana (-17 cents), Michigan (-15 cents), Illinois (-11 cents), Kentucky (-10 cents), Oklahoma (-9 cents), Maine (-8 cents), Wisconsin (-8 cents), Nebraska (-8 cents) and South Carolina (-7 cents).

The nation’s top 10 least expensive markets are: Mississippi ($2.32), Louisiana ($2.35), Alabama ($2.35), South Carolina ($2.36), Arkansas ($2.40), Texas ($2.41), Tennessee ($2.42), Oklahoma ($2.46), Missouri ($2.48) and Virginia ($2.49).

Great Lakes and Central States

On the week, the top five states in the country with the largest declines hail from the Great Lakes and Central region: Ohio (-21 cents), Indiana (-17 cents), Michigan (-15 cents), Illinois (-11 cents), and Kentucky (-10 cents). Joining these five to round out the top 10 list are Wisconsin and Nebraska with eight-cent declines at the pump. Gas prices are cheaper across the region and range from $2.89 in Illinois – which is the 13th most expensive state average in the country – to $2.49 in Missouri, which is the ninth cheapest state average in the country.

Gas prices dropped alongside a build in gasoline stocks. According to EIA data the region saw inventory build by 300,000 bbl to total 48.1 million bbl, which is below the five-year average of 50.8 million. Refinery utilization slid back a percent to 83% and is the lowest utilization rate for the week ending May 31 among all five regions in the country. Despite the deficit in stocks and low refinery utilization rate, gas prices are expected to remain stable; though during the summer, some states may see weekly spikes – declines or increases – due to the typical volatility in the region.

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