On Friday transport minister Gerry Brownlee spoke to the Road Transport Forum (RTF) on the government’s key transport priorities. Over the years the RTF have been a generous donor (not just to National) and have certainly received a transport policy very much tailored to their needs. There was nothing new in the speech in terms of project announcements and I guess this was perhaps not the audience to talk about the cancelling the Northern Busway extension, for example.
However, there were a few paragraphs that pick up on traffic trends in recent years – with the Minister making some rather weird connections between these trends and the success of the RoNS programme:
Between 2005 and 2012 total road travel – in terms of kilometres travelled – was almost unchanged.
There are likely to have been a number of contributing factors, including the Global Financial Crisis, population changes, and technology changes affecting the way people meet and communicate.
Heavy vehicle traffic was affected more than light traffic, dropping by over 4 per cent in 2009 – clearly an impact of the GFC.
But now we are seeing that vehicle kilometres travelled are beginning to increase again.
Heavy vehicle traffic on all roads increased 2.1 per cent in 2013, while light vehicle traffic grew 1.4 per cent.
NZ Transport Agency traffic counts for State highways shows a 4.1 per cent growth in heavy vehicle travel in the year to May 2014.
New Zealand’s vehicle fleet is also growing.
Average vehicle ownership growth has increased more than twice the speed of population growth, and recently released data shows new car purchases at their highest level since 1981.
These increases are not only because of population increases and the improving economy, but also because of the choices people make about their preferred modes of transport, and this is in the face of the biggest investment in public transport seen in decades.
So the case for investing in strategic State highways through the Roads of National Significance programme has been proved correct.
Gerry seems to be mixing up a few stats here as vehicle kilometres travelled is quite different from individual traffic counts and they aren’t always going to move in unison – but it’s the strange logic of the final paragraph that is difficult to understand. There are a few options below for what he could be trying to say:
- The case for spending $11 billion on the RoNS is to make people drive more.
- With per capita VKT declining a lot in recent years, it makes a lot of sense to spend $11b on a few motorways to try (unsuccessfully) and reverse this trend
- Construction of the RoNS projects themselves generate heaps of truck trips to move earth around, which is the point of the projects and therefore they are a success
Just as a reminder here’s a comparison of per capita VKT and per capita public transport use in recent years:
What’s your interpretation of what Gerry means?
Like with public transport patronage, I keep a close eye on what are happening with traffic volumes on the motorways thanks to the monthly data released by the NZTA. The data doesn’t cover the entire motorway network but it does cover a number of key locations on it that can help to give an indication of what’s happening. I think the picture painted by these figures is extremely interesting. The sites we get monthly data for are:
- ALPURT (the Orewa to Puhoi toll road)
- Harbour Bridge
- Upper Harbour Bridge
- SH16 between Royal Rd and Hobsonville Rd
- SH1 at Panama Rd
- SH20 between Puhinui Rd and Massey Rd
- SH1 at Drury
- SH1 at Bombay
Excluding Wellsford, here are the six sites that we have the most data for
There are a couple of things interesting going on here. At most sites the traffic volumes continue to remain fairly flat and in the case of the Harbour Bridge the annual figure remains lower than it was over a decade ago. Another interesting trend with the Harbour Bridge is that the annual figure is now bouncing up and down between 150k – 160k per day (it peaked in 2006 at 169k). However you see a clear change in the SH20 site. This isn’t surprising as in recent years there have been significant extensions and changes to that motorway including the opening of the Mt Roskill extension in May 2009 followed by the Manukau extension to SH1 and Manukau Harbour Crossing duplication in August 2010.
The changes can be shown even clearer by indexing them to Feb 2010 which is the earliest the SH20 data is available from.
You will also notice that ALPURT has shown growth. Unfortunately what isn’t clear is if this is a result of total traffic volumes along the route growing or people becoming more comfortable with paying for the toll road and so a higher percentage of people choosing it over the free route. The NZTA previously to recorded vehicle volumes at Hatfields Beach would have allowed that comparison but stopped doing that at the start of last year when they handed the road over to Auckland Transport.
As mentioned, the graphs above don’t include all of the collection sites reported on, the ones missing being on SH1 North of Wellsford, on the Upper Harbour Bridge and on SH16 between Royal Rd and Hobsonville. I haven’t graphed them due to how low the traffic volumes are in the case of Wellsford and how little data there is for the other two (only two years worth). In saying that the data that is available is quite interesting in its own right.
SH1 North of Wellsford – Traffic volumes are very seasonal peaking over summer but overall they have been in decline since monthly figures began in September 07. This is quite important as we often get told that the reason behind the Puhoi to Wellsford motorway is to unlock Northlands economy. Both the SH20 and Upper Harbour Bridge sites are interesting as the annual figures show traffic volumes on those sections had been flat since 2003. The volumes over the Upper Harbour Bridge only started increasing again in 2008 after the Upper Harbour section of SH18 was completed while the SH20 site only started increasing in 2011 after the Westgate to Hobsonville section of SH18 was completed.
To me these figures show a couple of key trends. The motorways not widened or extended have shown little to no growth and in some cases volumes remain below what they were in the mid 2000′s. In the places where we have built motorways, vehicle numbers have been increasing. To me what this effectively points out is that changes traffic volumes are really just a reflection of what we’ve invested in, or in other words a case of build it and they will come. That might sound logical (and it is) but it also highlights the opportunity we have to determine just how much traffic is on our roads in the future. Build more roads like the current plans suggest and we’ll get more traffic.
Of course the opposite is true too, remove roads and traffic disappears with it. This has been shown quite well in Seoul, Korea where since 2002, 15 expressways have been demolished and more are planned. The most famous of which was in Cheonggyecheon where they removed an elevated expressway and ground level roads carrying over 150,000 vehicles per day and restored the original stream making a wonderful urban park in the process.
It went from this:
And the outcome was even more impressive:
- Traffic volumes dropped while bus and subway usage rose
- There were increases in fish, birds and insects in the area.
- Temperatures decreased and are on average 3.6% lower than other parts of Seoul.
- It became a centre for cultural and economic activity.
- And perhaps most interesting to the NZTA/AT, traffic speeds on other roads increased which is an example of Braess’s paradox
Now I’m not suggesting that we tear any existing roads down but more just highlighting that we have the ability to shape the city how we want it. If we don’t want traffic volumes to increase in the future that we should start by not building a heap more roads.
An article in the New York Times looks at the recent announcements that transit (PT) ridership in the USA in 2013 was the highest since the 1950s – much the same as in Auckland. What’s perhaps most interesting in the 2013 numbers is that petrol prices doesn’t seem to have featured as much in the reasoning behind the increase:
The trade group said in its annual report that 10.65 billion passenger trips were taken on transit systems during the year, surpassing the post-1950s peak of 10.59 billion in 2008, when gas prices rose to $4 to $5 a gallon.
The ridership in 2013, when gas prices were lower than in 2008, undermines the conventional wisdom that transit use rises when those prices exceed a certain threshold, and suggests that other forces are bolstering enthusiasm for public transportation, said Michael Melaniphy, the president of the association.
“Now gas is averaging well under $4 a gallon, the economy is coming back and people are riding transit in record numbers,” Mr. Melaniphy said in an interview. “We’re seeing a fundamental shift in how people are moving about their communities.”
New Zealand has been different in regards to petrol with prices hovering around or even above the peaks of 2008 for the last few years. Here’s the graph of our average weekly petrol price up to 7th March.
Furthermore, the article notes how over the last 18 years, PT ridership has grown faster than the rate of population growth, whereas the level of driving per capita has fallen:
From 1995 to 2013, transit ridership rose 37 percent, well ahead of a 20 percent growth in population and a 23 percent increase in vehicle miles traveled, according to the association’s data.
Stronger economic growth is playing an important role in the increased use of public transit, as more people are using the systems to get to an increasing number of jobs, the association reported, and transit agencies are nurturing growth by expanding their systems or improving services.
“We’re seeing that where cities have invested in transit, their unemployment rates have dropped, and employment is going up because people can get there,” Mr. Melaniphy said.
Overall public transit ridership increased by 1.1 percent from 2012, with the biggest gains in rail service and in bus service for smaller cities.
Here’s what Auckland’s vehicle kilometres travelled per capita looks like compared to the number of trips per capita. Note: we won’t have VKT data for 2013 till later this year, also the latest PT trips per capita has started climbing again.
There’s often debate about whether the levelling off of traffic growth and the fairly dramatic increase in PT use over the past few years is a “blip” – caused by the global financial crisis and the fairly long recession that followed it, plus highly fluctuating oil prices in the past few years – or whether the changes are a longer term trend. With US ridership booming despite lower oil prices and at a time of growing economic success, the “blip” argument seems to be getting weaker and weaker. The longer term trends are well summarised in the article’s final two paragraphs:
Todd Litman, an analyst at the Victoria Transport Policy Institute in Victoria, British Columbia, said the new data were the latest indication of changing consumer preferences as a result of increasing urbanization, an aging population, and environmental and health concerns.
“A lot of people would prefer to drive less and rely more on walking, cycling and public transit, provided that those are high-quality options,” Mr. Litman said.
Time to change those traffic projections NZTA.
In this recent post Matt mapped census journey to work data across Auckland.
I will now use this data to draw some high-level inferences about returns on Goverment investment in transport infrastructure in Auckland in the period from 2007-13, i.e. between the last two census. The specific question I want to answer is: Given the level of Government expenditure in different transport modes in Auckland in the last 7 years, which mode(s) appear to have delivered the best returns in terms of their ability to accommodate growth in journey-to-work (JTW) travel demands?
Let’s look at the data. Total number of JTW trips by mode for the last two census are summarised in the table below, along with the change (growth) between census.
- Note 1: “Private vehicle” combines JTW trips for private/company cars, trucks, passengers, and motorcycles.
- Note 2: Public transport combines JTW trips for bus and rail.
This shows how an additional 23,223 JTW trips were undertaken on census day. Of these trips, 10,200 (44%) were undertaken by car; 9,118 (40%) were undertaken by public transport; and 3,825 (16%) were undertaken by walking/cycling.
Matt has helped pull together a spreadsheet of government transport investment by mode from 2006-13. This includes investment by NZTA (nee Transit) and local government. In the table below I have added total expenditure by mode, and then used this to calculate an average cost per (new) JTW trip and (additional) JTW-km.
Note 3: Average trip length was calculated as the weighted average trip length using HTS data.
Now we start to see some interesting trends. From these numbers it appears that Government investment in public transport and walking/cycling has been approximately 2.6 and 6.7 times more cost effective than investment in roads during this period, at least when measured on a per JTW-km basis (the differential is even greater when you use the $ per JTW trip indicator). This in turn suggests that it would be more cost-effectively to cater for growth in JTW travel demands by shifting investment away from roads and into public transport and walking/cycling.
This raises the question of how much should our current investment levels shift in order to deliver approximately neutral investment outcomes for each mode? To help with this I have calculated what I call a “neutrality factor”. For each mode this is calculated as the ratio of 1) it’s share of growth in JTW-kms divided by 2) its share of total expenditure. This tells you how much expenditure on a particular mode would have to change to have achieved a ratio of 1.0, i.e. a mode’s share of JTW-km growth was equal to its share of Government investment.
In the table below I have calculated the neutrality factor for each mode.
When calculated on this basis, it would suggest that we should increase government investment in public transport and walking/cycling expenditure approximately two-fold and five-fold respectively, while reducing investment in roads by approximately 30%.
Of course, this analysis is a “partial analysis” because it assumes demand (number of new JTW trips and kms) is held constant. In fact, if we were to see such a shift in transport investment priorities over a sustained period of several years then you would expect the demand for each mode to respond accordingly. More specifically, shifting government investment away from roads and into public transport and walking/cycling would be likely to encourage more people to use those modes, which would in turn warrant greater government investment. Hence, the changes in transport investment priorities suggested by this analysis are likely to be relatively conservative.
This is obviously a back of the envelope (“BOE”) analysis.
The most obvious issue is that JTW trips account for only a proportion of total travel. Education travel is another major contributor to peak period congestion. However this tends to be slanted in favour of public transport and walking/cycling – such that including these trips in the analysis seems likely to confirm these outcomes.
The other is that we are lumping together capital and operating costs. While this makes sense in the long run (because after all, capital investment is really just a very lumpy operating cost!) it may be distorted in the short run. Hence it might be useful to extend our analysis by calculating the effectiveness of transport investment from 2001 to 2013. Indeed, the period from 2001-2006 seems to have been associated with less dramatic changes in travel demands than the period from 2006-2013.
While this analysis certainly could be improved, even now it seems to provide a useful indication of the relative returns from Government investment in different transport modes from 2006-13. I also feel somewhat justified using it because members of the current Government frequently justify their transport investment priorities on the grounds of raw 2006 JTW mode share. I’ve followed their lead and focused on JTW trips, but instead looked at the change in demand over time and then compared it to relative expenditure levels.
This tells quite a different story than if you look at raw JTW mode share.
On this basis I’d suggest that Government investment in public transport and walking/cycling in Auckland has typically delivered more cost-effective returns than investment in road based transport infrastructure. So the next someone tries to argue that we should invest more in roads because “86% of Aucklanders drive to work by car”, please challenge them on the basis that relative potential for growth – rather than the level of existing demands – should be the primary determinant of our future investment priorities.
Footnote: In the most recent census private vehicle mode share appears to have dropped from 86% in 2006 to 83% in 2013. Given that we’re yet to see the effects of electrification, new EMUs, integrated ticketing, and the New Network, one would have to think that the relative returns from Government investment in public transport might be similar high if not higher by the time the next census rolls around.
Many times in the last few years we have highlighted a ‘flat-lining’ or at least slowing of growth in car travel across New Zealand. The same trends have been seen in many overseas cities and countries – with the slowing in the UK dating back at least 20 years now. Yet for some bizarre reason this change hasn’t filtered through to those making projections about future traffic growth. In the UK we have seen projection after projection forecasting significant growth – even though consistently it doesn’t happen.
The same process has happened in Washington state, where the Department of Transportation has ignored the flat-lining of traffic growth and continued to forecast significant increases – despite all evidence suggesting they need to change:
Lance Wiggs has picked up on a recent report released by Treasury that looks into the evidence behind the key elements of the transport sector. Towards the end of the report Treasury analyses some projections of future transport demand prepared by NZTA and NZIER. Let’s let Lance pick up the story here:
This line records use of a certain item by New Zealand population since 2000. Where do you think it will be in say 20 years time?
The statistic went up, and then down, and so the best estimate to me would be a flat or downward trend. But rather strangely the authors of this chart determined that all of their estimates would be up, and that the lowest change would be a substantial increase. Here it is, with my added red line eyeball trend:
The chart, of course, is estimated vehicle use in New Zealand, expressed in millions of kilometres travelled. It’s sourced from the “ National Long-Term Land Transport Demand Model, NZIER and NZTA (2013)”, and that’s a critical model as it feeds into all sorts of cost-benefit analysis and policy for transport in New Zealand.
The data is sourced from this report, which appears to make the same mistakes as transport modelling projections in the UK and Washington state have done for the past 20 years – by refusing to believe that anything ever changes about how people travel. Even though evidence to the contrary is absolutely everywhere. Similar bizarre conclusions are made about future levels of public transport use. Back to Lance:
The bias towards cars is also reflected in this chart of forecast public transport statistics – which doesn’t pass the giggle test either. Witness the trend and the projections below (the red is my version of the trend-line):
So for some unfathomable reason the growth in the use of public transport is forecast to immediately and dramatically fall, while the growth in the use of cars will immediately and dramatically rise. It’s ludicrous.
What’s interesting is that a footnote in the Treasury paper notes that these projected trends are completely at odds with what has been happening in recent years. It says:
We note that, although the NZIER / NZTA model predicts a gradual decline in the future, the public transport share of passenger kilometres has shown a steady growth trend over the past decade. This may merit further monitoring and consideration as time progresses.
It seems that at least the public transport projections are a little bit too insane for even Treasury to believe.
In any other area of government activity or a business if the computer models were projecting the complete opposite of what’s happening, what’s been happening for quite some time and what’s happening in cities and countries all over the world, we’d chuck the models out and start again. Yet for some reason we keep believing these illogical outputs and use them to determine where and how to spend billions of dollars of public money. It’s quite disgraceful really.
A view from new Britomart bar and restaurant Ostro that seems to perfectly express the contradictory current phase in Auckland City’s development.
What a great scene:
Sitting here amidst the sophistication of the latest addition to the our reborn downtown with all the perfectly prepared kai moana you could want, reassuringly expensive wines from every viticultured corner of the country, the cruise liners slipping around North Head, and the sculptural forms of the gantry cranes lined up and waiting patiently in the late afternoon sun like a row of giant robotic footmen, it is hard not to marvel at how lovely Auckland can be and at how far it has come recently.
Britomart is surely the best example of a Transport Orientated Development around, showing not just what can be achieved by coordinating land use and Transit investment well, but also just what a great resource there is in our urban centres if only we redevelop them properly. Central Auckland is really beginning to show extraordinary promise for what quite recently was an very dreary place, and it is not difficult to predict that these improvements are only going to accelerate over the years ahead. It’s like we’ve suddenly discovered that the city is by the sea.
With the successes of Britomart, both the train station itself and the redevelopment of the commercial buildings above; the Shared Spaces, which now surely will spread [not least down into the Britomart block itself]; and the first phases of Wynyard Quarter, the quality of Auckland’s City Centre is poised to explode in vitality, desirability, and productivity.
The next phase should be even more dramatic: The transformation of big city streets into more interesting and specialised uses; Victoria hosting a Linear Park on half its width uniting the two parks on either side of the city, Victoria and Albert; Wellesley a Transit corridor, efficiently bringing thousands of bus riders into the heart of the city: Queen and Quay, downscaling and becoming more pedestrian and place focussed [Quay also an important cycle route], Fanshaw and Customs moving ever more people both in more efficient bus systems and, like Mayoral, focussing of carrying general traffic across town.
Along with the big build at Wynyard, the city will also get new towers at Downtown and on the corner of Victoria and Albert, along with the apartment building boom that is already underway all over the city.
This is no guess about the future but rather the continuation of what has already begun; the latest census revealed that central Auckland’s residential population grew 46.5% between 2006-13 by far the greatest growth in the whole country. Vacant commercial floor space is drying up and demand is rising. Like all over the western world, inner city living and working is not just back, it’s hot. Auckland is already surfing the urbanising zeitgiest well.
Interestingly both the the new towers mentioned above will sit on top of the City Rail Link that in 2015 will begin to be constructed at least for the section below the new Downtown Centre. And as is clear from the growth listed above that the city will urgently need this resource in order to bring, circulate, and disperse back out to the city’s extremities all the people that will work, live, and recreate in this transforming city.
Because if there is one uniting theme to all of this improvement it is the increase in the numbers of people entering the City without a corresponding increase in the numbers of cars- if not their actual decrease. All the growth in number of those entering the Central City this century has been on the improved Transit systems, especially rail and the buses of the Northern Busway, but also ferries and cycling and walking. This has to continue if not accelerate, because the place quality improvements require a reduction in the domination of place by vehicles, or at least are impossible to achieve while the city is swamped in cars. Essentially there is a very simple equation observable in urban renewal:
More People + Fewer Cars = Better City
So in order to achieve this the city needs to be attractive and accessible to people and efficient and productive for business. How are these aims best achieved at the planning and investment level? It seems very clear all across the world that there are three investments that have proven to consistently achieve these outcomes in urban development, whether it’s London, or, Barcelona, or Shanghai, or Amsterdam, or Portland, or Bilboa, or Sydney or Brisbane, or Wellington or where-ever, these are every city’s best best:
- repurposed mixed use Waterfronts with
- dynamic Public Spaces and Activities served by
- high quality Public Transit + Walking + Cycling amenity
The last to efficiently bring and circulate large numbers of people in ways that do not adversely affect place, in fact ideally enhance it, the second to attract, entertain, and retain residents, workers, and businesses, and the first because the whole new venture is so much more desirable and therefore valuable if it’s by the sea, a lake, or along a river, making the investment much more likely to be viable. But the essential component is that these all have to come together in a centre in order for the attractions and vitality to double up on themselves, for these improvements to agglomerate.*
[*There are three other investments that cities often try to use as springboards for improvement but that all have much more fraught outcomes around the world: Casinos, Stadia, and Convention Centres, and all have a common theme; they usually have the same big blank walled city-blocking form, intermittent use, and internalised programmes- and are often built on an auto-dependent model with vast parking garages and motorway like access routes right up to them; both highly anti-urban place ruining systems.]
So it is clear both that Auckland is largely on the right track and that there are enormous challenges ahead. Wynyard Quarter is not being built in the best order, in the way that Britomart has been: Ideally you built at least the bones of the High Quality Transit system first, Wynyard is going to quickly have to get better and more permanent Transit systems in place as the building sites currently used as car parks start to get built on and these will at least at first have to be bus systems- the only near term way of moving high volumes of people- and surely they will have to get those buses working in a trainlike way, ie with stations more than stops, while working towards upgrading some bus routes to a modern light rail system.
The problem of funding the City Rail Link needs to be addressed in 2014, which on the one hand means either changing the government or changing the government’s mind, as well as working out an efficient way for the Council to fund its share of the capital cost too. Increasingly I think this could be around a PPP for the three new stations as there will be changes in land value to be captured there.
Then there is the related issue of the accommodating hundreds of buses in the city, the CRL will in time limit the need to endlessly grow the numbers of buses on city streets but even once it’s open there will still be a need for a lot of buses in the city, especially from the North Shore. Hopefully the new plans for concentrating these onto specific routes and speeding their passage through the city will be done well and make a huge difference. But also I think it’s vital that the quality of the buses themselves are improved, that they aren’t walled off with blocking advertising and that their exhaust and noise standards are improved radically, ideally that emissions are eliminated all together. Therefore the electrification of all our urban transport systems should be a matter of higher priority. Electricity is, after all, our great local resource and so much better for the increasingly contested city streets for everyone.
All of which brings us back to the image:
Also clearly visible here are hundreds and hundreds of new cars, well at least new to NZ , freshly off-loaded and ready for our streets and roads. So if [leaving aside the issue of whether this is the best use of these warves], as I predict, these vehicles will increasingly be less and less welcome on the streets of the City Centre then where are they headed? Out to the suburbs and the exurbs I suppose; the more dispersed the living the more ideal the car becomes. Auckland is becoming a Mullet City. It is surely getting more and more bi-level like the famous westie haircut: Increasingly urbane, more European in form, more walkable, ridable and lively in the centre. But still largely auto-dependent, low rise, dispersed and spread out, more American-new-city in form, the further out you go.
To some degree this is inevitable, and is in the very nature of cities, but I hope this doesn’t become too extreme, Auckland could develop a number of great and happily more intense metropolitan centres. So I hope it’s more blurred than this, but the latest version of the Draft Unitary Plan doesn’t inspire confidence. Councillors facing reelection and a vocal anti-change lobby greatly reduced the areas that can enjoy the great gift of the city; the ‘power of nearness’, intensity, and if it stays like this then growth and intensity will be concentrated into just a few areas, and in particular the Centre. This will reinforce a contrasting bi-level city. This form is increasingly apparent globally as The Great Inversion unfolds and City Centres and Inner Suburbs become more desirable and therefore expensive, and as this partly reflects differences in transport value of place, or relative inaccessibility, so the provision of affordable transport options throughout the wider city is critical to ameliorating this tendency [the existing reach of the rail network will become increasingly valuable for equalising access; especially after it is more essential to Auckland once the CRL is operational and the New Bus Network is integrated with it with new interchange stations].
But then there are many ways the suburbs can improve. Auckland’s older tram built suburbs are already relatively dense, are pleasantly leafy and walkable [remnant pathways linking through to old tram stops are sign of this], and have enough old shops and mixed commercial parts to give them great bones. Many simply need improvements in Transit service and cycling amenity to become really good; work for the rest of this decade. Then if we can get the Unitary Plan to allow some decent mixed use density in the centres that serve these suburbs many may find their own neighbourhood pretty well has everything they need as well as being well connected to the big City and other Centres. The newer further out sprawl-burbs are more difficult to bring into this century, but simply calming residential streets and serving those missing modes will go along way to repairing those urban form monocultures.
All of this is to say that 2013 has been great for Auckland’s urban quality and I’m confident 2014 will see this accelerate. So thanks for visiting the site and have a wonderful summer: In the City or as far away as you can get [a perfect use for our cars]…
OK, I admit I haven’t come up with the catchiest title for this post, but it’s a good TL;DR. As I’ve written previously, world oil prices were pretty dang low for 20-odd years: from the mid-80s to the mid-2000s. The price of a litre of petrol in New Zealand reached its lowest point in 1999, and started to rise from then on – with major rises in the last decade.
Petrol Consumption Trends
Our consumption of petrol grew and grew, until 2004. Since then, it’s been going in the downward direction, and more so since the 2008 recession began. Other bloggers have written about related issues such as the decline in drivers’ licenses being issued, less distance being travelled, and lower vehicle ownership.
The trends weren’t confined to New Zealand, either. Kent has written about declining travel in the US, and in fact there have been declines, or at least less growth, throughout the OECD. And it all started happening around 2003-2005.
Various explanations have been floated for this. Could it have been the millenials, too busy spending time on Facebook and smartphones to drive? Was it the recession? Perhaps online shopping?
Personally, I don’t think it’s a coincidence that vehicle travel and fuel consumption started to decline all around the OECD, at around the same time, just as oil prices started to go up dramatically. I consider these higher prices to be the main factor in reduced driving – certainly up until recession hit in 2008. Higher prices were the main kicker which may have started other shifts, e.g. young people becoming less likely to get a license.
Furthermore, fuel prices are likely to stay high, and in fact to increase over time. You would hope that governments would take this into account when determining its transport policy – although ours doesn’t seem very interested in doing so.
Some countries have reported more of a decline in driving amongst young people, and I don’t think this is a coincidence either. Young people would have been particularly hard hit by high prices – their lower incomes mean they had to cut back more, and their travel was often discretionary. Let’s say you are young enough to live at your parents, and you get $20 a week to do whatever you like with. Well, that $20 buys half as much petrol as it would have ten years ago. You can blow your entire pocket money just in getting to a few friends’ houses. It’s no wonder that fewer people are getting licenses. Another factor is that, post-2008, many countries are struggling with high youth unemployment.
In 2007, the excellently named Booz Allen & Hamilton did some research on just how much fuel prices affect travel. They estimated the short run elasticity of petrol consumption at -0.15, or -0.2 in the medium term. Elasticity is a commonly used concept in economics, and you can check out the Wikipedia page for more info – but in brief, an elasticity of -0.2 means that a 10% increase in the price of petrol is associated with a 2% decrease in petrol consumption. If something goes up in price, we buy less of it, right? Petrol is one of those things that we’re not very price sensitive to – the demand is “inelastic” – but it’s naive to think that higher prices don’t have an effect.
And, over the last decade, the increases in petrol prices have been massive. In real terms, they’ve gone from $1.27 in June 2003 to above $2.04 in June 2013. That’s a rise of 60%. In nominal terms, the increase is even larger. And if you look back to June 1999, when prices bottomed out, there’s been a real increase of 80% since then.
Holding other things constant – i.e. forgetting about economic growth, population growth and so on – the numbers from Booz Allen & Hamilton suggest that per-household petrol consumption would have fallen by 12% since 2004. That’s not too different from what we’ve actually seen.
Notwithstanding that elasticity estimates can be a lot less accurate when you get such large percentage changes, we’re certainly talking the right order of magnitude. I think a regression analysis would be likely to show that the main factor in decreased petrol use and driving is, indeed, higher prices.
Taking It Further
I want to point out that a lot of the non-academic debate on changing travel trends has focussed on things other than prices. In fact, even some of the ‘academic’ stuff seems to have ignored prices – see the paper here, although that only presents arguments rather than any kind of quantitative analysis. As an economist, I’m quite stunned by this. Transport fuels are a major part of household budgets (more than $2,300 a year on average), and prices have risen massively in the last ten years, and people don’t think that’s had an impact on the way we get around? I know I drive differently than I would if petrol was still $1.20 a litre. My daily patterns mightn’t change much, but I’d probably go on more road trips, more spontaneous drives in the weekend and so on. I’ll be looking at this more in the future.
There’s a long running debate over whether the flattening/decline of traffic growth over the past few years is attributable mainly to the rather ‘up and down’ economic situation over a fairly similar time period – or whether this reflects a more fundamental change in travel habits.
This is a critical question – on the one hand if the recent trends are due to the economic situation (certainly the position taken by NZIER economist John Stephenson at the transport conference I went to a few weeks back) then they’re just something of an anomaly and likely to ‘correct’ over time back to normal steady traffic growth. Under this scenario, the long term transport models we have that predict significant traffic growth in the future might be right and there may be some long term justification for many of the motorway we’re either building or planning at the moment (even if we’re perhaps building them too early compared to other transport priorities).
On the other hand, if the flattening or decline of traffic volumes is more independent of the economic situation then it may be a sign of longer term changes to travel habits. These longer term shifts potentially arise from changes such as a fundamental increase in the price of petrol, technological advances which mean that cars aren’t needed to interact with friends in the way they once were, urban structure changes which reflect a ‘re-urbanisation’, improved public transport and so on. The key point here is that these changes are likely to be fairly long-lived – fundamentally impacting upon future predicted travel growth, completely debunking transport models and having an absolutely massive impact on future transport needs.
A new study from the US PIRG institute looks at this question in a bit more detail – to try and understand in more detail the changing travel patterns across the USA over the past few years. Some key headline findings outline in the report include:
- The proportion of workers commuting by private vehicle—either alone or in a carpool—declined in 99 out of 100 of America’s most populous urbanized areas between 2000 and the 2007-2011 period averaged in U.S. Census data. (New Orleans was the only exception here).
- From 2006 to 2011, the average number of miles driven per resident fell in almost three-quarters of America’s largest urbanized areas for which up-to-date and accurate Federal Highway Administration data are available (54 out of 74 urban areas).
- The proportion of households without cars increased in 84 out of the 100 largest urbanized areas from 2006 to 2011. The proportion of households with two cars or more cars decreased in 86 out of the 100 of these areas during that period.
- The proportion of residents bicycling to work increased in 85 out of 100 of America’s largest urbanized areas between 2000 and 2007-2011.
- The number of passenger-miles traveled per capita on transit increased in 60 out of 98 of America’s large urbanized areas whose trends could be analyzed between 2005 and 2010.
Perhaps the most interesting findings from the report arise when the economic performance of different cities over the past few years is compared with the average number of vehicle miles driven per person. You might expect that cities which have struggle economically over the past few years would have the biggest decline in per capita travel – because of higher unemployment, reduced business travel, generally less wealth to spend on cars etc. However, the report’s analysis actually shows the opposite is true:
What the data appears to be showing is that cities which experienced the greatest decrease in per capita VMT between 2006 and 2011 were the cities which fared best in terms of lower unemployment, higher median income and a lower level of increase in poverty.
The report’s authors make some pretty heavy hitting conclusions and recommendations for policymakers:
The study found that cities with the largest decreases in driving were not those hit hardest by the recession. On the contrary, the economies of urbanized areas with the largest declines in driving appear to have been less affected by the recession according to unemployment, income and poverty indicators.
“Government should support transportation initiatives that reflect these travel trends,” said Baxandall. “Instead of wasting taxpayer dollars continuing to enlarge our grandfather’s Interstate Highway System, we should invest in the kinds of transportation options that the public increasingly favors.”
I’m guessing that if someone were to study what is happening with the economy locally we would see some similar trends. Meanwhile Auckland continues to gear up for a giant spend-up on motorways.
In the comments, “Handlebars Matt” provided a link to this video about how nobody is using Portugal’s motorway system – which was built at vast cost over the past decade:
I often fear that this is the future for many of the Roads of National Significance that are either under construction or due to begin construction in the next few years. Particular candidates for incredibly low levels of use seem to be:
- Puhoi-Warkworth. Due to the new road not being much faster than what’s currently there, the Puhoi ramps providing a link between the existing Northern Gateway Road (which does provide a significant time saving) and the existing SH1 likely to be faster and cheaper for most people compared to a toll road that doesn’t even connect well to Warkworth and requires people to double back through the messy Hill Street intersection to get to the eastern beaches.
- Tauranga Eastern Link. We all know the history of toll roads in Tauranga and I struggle to see how this won’t be another empty toll road offering drivers little incentive to use it rather than the existing route.
- Hamilton bypass. Current projections only see 7,000 vehicles using a section of this $890 million section of the Waikato Expressway by 2021. This route seems unlikely to be tolled but will still be something of a “ghost road” even if the notoriously optimistic projections are correct.
The same might be true of many parts of the Wellington RoNS, although if they are “successful” and attract traffic the main impact will be worse congestion in downtown Wellington and reduced use of the railway line.
A shame we won’t be able to learn from Portugal until many billions of dollars of taxpayers’ money has been wasted.
We have frequently raised concerns about projected future traffic growth, given that in recent years there has been an extended flat-lining of traffic growth. What’s perhaps most concerning about these projections is how they ignore what has actually happened in the recent past and how those producing the projections don’t seem to learn from past mistakes.
This isn’t just an Auckland problem. An article I came across recently looks at projections for a bridge across Lake Washington in Seattle highlights how stubborn the projections of growth are despite evidence to the contrary:
What’s crazy about this graph is how persistently wrong the projections have been – yet without any change to reflect the reality of declining traffic volumes over a 15 year period between 1996 and 2011.
Yet it’s not just a specific example of a bridge in one American city where we see these persistently wrong projections coming through. Let’s look at a comparison of official traffic projections across the UK over the past 20 years and compare those with what actually happened:
It’s hard to know whether these repeated mistakes are just accidental, ignorant or wilfully neglectful of reality.
Our own local example of this ignorance is in the traffic projections being used for the stupid Additional Harbour Crossing Project, where modelled traffic growth rates completely ignored recent trends and therefore were calculated from a base that was significantly too high:
This graph was from a year ago and in the past when I’ve posed it, there have been some that say “look it’s starting to rise again” but the reality is it isn’t. The most recent monthly data shows traffic have flat-lined and volumes are still less than it was a decade ago (monthly figures only started in late 2007).
Similarly another frequent comment we see when this is discussed is to the effect hat the downturn is only due to the current state of the economy. However many economic indicators are pointing to the economy being much healthier today than it was a few years ago. Other indicators highlight that while on a per capita or percentage basis we might not be doing as well as in the past, on a total basis we are doing well. For example despite the percentage of people who are unemployed being higher than it was in 2007/08, in total there are actually significantly more people employed at the moment.
I suspect traffic projections keep making these mistakes because they are calculated using models with fundamental problems in them. They are generally designed to predict the future based on extrapolating our behaviour from some point in the past. That may have worked in the 90′s (and earlier) but it doesn’t work now and one of the key reasons is that we are seeing generational changes occurring with young people choosing not to drive as much as older generations. Yet while road models might be well over estimating vehicle trips, PT models have been doing the opposite. One of the best examples is Britomart where we exceeded the 2021 projected daily patronage in 2011.
And even the Ministry of Transport in their response to the City Centre Future Access Study said that private vehicle trips were probably being overestimated.
When there are tens of billions of dollars of public money is riding on these faulty projections, it suggests we need a new approach starting with not believing the current projections.