A  few weeks ago I showed energy consumption as a share of  nominal personal consumption expenditures (PCE ) and though it would be interesting to follow up with food and energy as a share of PCE. From 1959 to 1999 food and energy fell from about 33% of PCE to 17.5%.  This almost 50% drop in food and energy as a share of spending reflected several things.  But overall it probably reflect rising standards of living as the fall allowed consumers to spend their income on other things.  But note that since 1999 food and energy have been absorbing a rising share of total consumption.  Something similar happened in the 1970s when the real price of food and energy also rose.

One way consumers adjust to higher energy prices or a lower standard of living  is to delay purchasing a new car.  This is such a strong tendency that energy and autos combined account for almost a constant share of PCE..

Looked at another way, the number of cars and light trucks on the road per household has stagnated since about 1999 .It is an interesting question if this recent flattening is a cyclical or secular development. 

The number of cars and light trucks per driver has followed a similar pattern.


If this is a secular trend it is a basic reason why the auto industry industry is a mature industry with very weak growth prospect, especially if you combine these trends with a much slower growth in the number
of drivers.  The bulge in the number of  drivers in the 1960s-70s is the baby-boomers starting to drive. But in about another 15 years or so  they will be reaching the age where they are going to have to turn in their drivers licenses and quit driving.  Is this the source of demand that Google is targeting with its current experiments with driver-less cars?