We have long criticised the Ministry of Transport as being horribly outdated in their thinking on transport matters. It’s always difficult to know the extent to which the Ministry is just reflecting the government’s political direction or whether they truly believe what they’re saying, but in more recent times there have been a few signs that the Ministry might be getting its act together. For example, their Briefing to the Incoming Minister highlighted some important changing transport trends, particularly when looking at future funding issues.

It seems like some of the more interesting advice in the “BIM” might have come out of the Ministry’s “Strategic Policy Programme“, which has recently published information on projects in three key areas:

I’ll look to get to all these documents in a few posts over the coming days and weeks, but for now focus on the “Future Demand” work, which seems to have highlighted the uncertainty around the future of transport that comes through in the BIM more strongly than it has before. The summary highlights the key issue:

The road network is worth more than $60 billion and costs more than $1 billion a year to maintain. We are planning to invest $10 billion over the next ten years to change the shape of the network to improve its quality and capacity.

This would be relatively straightforward if we knew how demand would change. The challenge we face, however, is there have recently been changes to the patterns of demand for personal travel.

From 1980 to 2004 we saw annual increase in demand in the order of three percent per year. This highlighted the importance of tackling congestion and improving safety and gave us assurance revenue would grow to cover the costs of a growing network. From 2005 to 2013 total demand only grew by 0.25 percent per year.

We now face an uncertain future. We cannot be certain demand will return to pre-2005 levels of growth nor can we be certain it will remain flat. This means we can no longer rely on traditional forecasting models alone to help us to decide how to invest.

Importantly, the Ministry acknowledges a systematic over-projection of future demand has occurred in recent years:


As there are so many factors that may affect future transport demand, plus so much uncertainty around the short-term and long-term causes of these changes, the Ministry’s project developed four different scenarios for the future based around two-axis: whether the relative cost of energy would increase or decrease and whether technological change would lead to a preference for virtual or physical accessibility.


Perhaps what is most interesting in the scenarios is the modelling that was done on future total vehicle kilometres travelled between 2014 and 2042 and that they declined in three of the four scenarios. This is not a per capita decline, but an absolute decline. It is only the “traveller’s paradise” scenario which saw VKT increase over this time period.

The study draws some interesting conclusions:

When we think about creating a thriving New Zealand we should recognise we are trying to improve access not just mobility. There are three different ways we can achieve this: with good transport systems; with good spatial planning; or by improving digital access. We need to integrate our thinking across these three areas to achieve the optimal outcome.

To reduce the uncertainty we face we should seek to better understand the factors affecting the changing patterns of demand and refresh our demand models accordingly. We should look both at social trends and also speed in development, take-up and impact of new technologies.

To ensure resilience of the access system we develop for New Zealand we should seek to build in flexibility where we can. This will allow us to respond more quickly to changing patterns of demand and reduce the likelihood that we will make investments which will become unnecessary.

We need to recognise that the investment decisions we make will shape patterns of demand and not just respond to them. We should move away from the approach of seeking to simply predict future demand and then provide for it. We should instead debate the sort of access we want and decide how to invest to support the future.

That last sentence is exactly what I’ve long thought, our travel choices are a reflection of the system that we’ve invested in. It’s no surprise that so many rely on cars for transport options when for so long that’s the only thing we invested in improving while at the same time we allowing all alternatives to get substantially less attractive and useful. The changing trends that we’ve been seeing over the last decade are in part a response to the fact we’ve slowly started to improve some of those alternatives.

There’s a huge amount of additional background information on the project website, which is worth a read through as it summarises a lot of discussion about the issue of “peak car”.

While it’s great to see the Ministry doing this work, the real test will be to see whether this affects any policy changes. The draft Government Policy Statement seemed to write off the recent flattening of VKT as a “blip”, whereas this future-focused work suggests that, under the majority of scenarios, it’s here to stay and VKT could even start declining.

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  1. The traffic prediction chart is fascinating. At first glance it is monotone; always up, but there are some interesting subtleties: 2006 for example looks like quite a brave call for the short term; flat for 3 years, before shooting up along with all the rest, and that was pre-GFC. Especially in contrast to 2008, which didn’t piss about- just straight up.

    Why do they always head up? Is it just that these experts are incapable of spotting change when it’s upon them? Kind of begs the question of their competence if that were the case, as spotting change is pretty much the whole point of predicting.

    Nope, I don’t think that’s the real problem, or all of it anyway, it’s more that the entire system of just building more roads, which is an end in itself for at least dominant parts MoT and NZTA and of course their private sector partners, needs this line to always be rising to help justify what they do. It’s the tail wagging the dog.

    However, the fact that this chart came out of the MoT is a very encouraging sign, and possibly represents something of an arm wrestle within our institutions in the face of the reality of profound change. A battle between business-as-usual cynics who see their principle job as supporting the status quo [Yes ,Minister], and intelligent and hardworking contentious empiricists who are embarrassed by the increasing disconnection between the real world and their descriptions of it?

    1. I think it must be starting to embarrass *someone* that $3.6 billion dollars is being spent annually (projected to rise to $4.4 billion very soon), with little to show for it.

  2. I think the scenarios presented are interesting, primarily because I believe the future of vkt will be a mix of all four scenarios.

    The hard part will be guessing the mix in percentage terms of each of the four scenarios.

    Segmenting by demographics ie age, income, region, may provide some of the answer, but I doubt the answer will be easy to formulate and it is likely to be challenged, especially by those who the most to fear from a change, such as those whose business models rely on the status quo.

  3. Time for some new metrics too then? Bus km, train km, ferry km, passenger km, bicycle km, electric bicycle km, walk km etc.

  4. Even under the ‘travellers paradise’, it might still be air travel that benefits, muting demand. Alongside the huge transformation that the internet has brought, I don’t think there is anything else which has changed behaviour about within-country travel so much.

    Growth is being undermined at both ends of the age spectrum. The young are reluctant to license, and in the cities are more likely to use transit, and at the other end as people retire their vehicle use halves, and then declines further as they age.

  5. If people travel less in the future then that implies we should spend less on transport infrastructure. But doesn’t that also imply budgeting less for buses and rail as well? I mean if people dont need to travel maybe we dont need the big ticket items that support travel.

    1. But it isn’t ‘travel less’ it’s drive less. Walking, riding, and taking Transit is still travel; they are up.

      Remember ‘work from home’ has stayed stubbornly stuck at 7% all through the internet and smartphone eras according to the census.

      1. Is public transport up significantly nationwide? Where is the matching NZ wide graph? There has a been a bit of increase in Auckland, but the vast majority of trips in NZ are not to the Auckland CBD. I dont follow your logic that car travel distances are not increasing so more should be spent on rail or buses.
        Let’s remember that PT is an inferior good, that is a good people use more of when they cant afford to use a car for the same trip. The Auckland increase in rail use might be a wealth effect.

        1. Well why not keep going till you have a big enough sample to remove any meaning… I hear they’re still driving more in Szechuan province?

          Obviously Auckland is an outlier in NZ, scale, density, growth. That’s the whole point of this blog. Auckland, and other NZ cities, but less so, require different kit to the provinces. Pretty simple, eh?

        2. The point I was clumsily trying to make is that rather than being gleeful that veh.km isn’t growing at the moment we need to realise that Treasury will see that as a reason to cut transport spending and not a reason to divert roads money to PT. After all the veh.km stats are only used as inputs in financial models in Wellington and not in the transport models used to claim funding for specific road projects.

        3. Well we would still be a lot better off if they cut spending on unnecessary roads and left PT funding alone. Transport wise we’d be about the same, but richer as a nation and without an even huger operations and renewals obligation.

        4. “that is a good people use more of when they cant afford to use a car for the same trip” – I hope you are only stating that as an opinion not a fact. If a fact where is the evidence to back it up.

          That sounds like a traffic engineer’s view of the world (note: world – not just NZ).

          If true, there must be an awful lot of poor people in Europe/East Asia/South America and almost none in the United States, UK, Australia, Canada or NZ.

          I think people use the car because the whole transport system has built to make that as easy as possible. The opposite effect is present for PT and cycling.

        5. I wouldn’t use a car to get to work if you paid me, it would be slower, less convenient, more stressful, more expensive and seriously impinge on my ability to drink three pints at after work drinks on Friday. For me driving is often (but not always, naturally) the inferior good.

        6. Not sure which part you are challenging so I will answer both. 1/ An inferior good is one where demand increases as incomes decrease- that part I am stating as fact as it is the definition of inferior goods. http://www.wisegeek.com/what-are-inferior-goods.htm
          2/ That PT is an example of an inferior good is one of those ideas generally stated as an example of an inferior good but it is actually really hard to prove. Most papers addressing the issue use cross-section data of cities that have very different structures and transport systems and suffer from endogeneity problems ie higher paid jobs locate in centres and trains go to centres so while higher paid people can use trains it is not cause and effect just two things caused by something else. So use a thought experiment instead. If you had any amount of money and lived in a fancy house in Herne Bay and parking wasnt a problem to you (as money doesnt matter) would you drive or wait for a bus?

        7. I am in that scenario already more or less, I have my choice of house in a very nice neighbourhood and can easily afford parking to the point where it doesn’t matter. I still take the bus, because driving would be slower, less convenient, and less reliable. It would be a change from sitting in comfort travelling quickly using the bus lane to sitting in traffic and unable to use my ipad behind the wheel, and slowly going angry-mad waiting for the backed up cars to clear the intersection. I don’t wait for the bus, there is seriously one every two minutes past my house. You’re suggestion that it’s a dichotomy between ‘waiting’ for a bus or driving (without qualification or constraint) is perhaps a little telling of your ideological prejudices. Had the same experience when I lived on the North Shore. You’d have had to pay me a lot of money to swap my 25 minute busway commute for 60+ minutes sitting in traffic each way. Talk about waiting, I’m sure you’ve expereinced a ramp signal or two!

          There is definitely the case for the opposite, people on higher incomes buy fancy homes in desirable central areas, and often find it’s far more convenient to get around the central suburbs by PT. Come ride the bus through Parnell with me if you don’t see it.

        8. The answer to the question would i wait for a bus is that it depends, if i had to wait two hours for a bus, no i wouldn’t, if i had a turn up and go service with integrated ticketing that allowed me to do something else with my commuting time ie read, email, calls, plan my day, yes i would.

          Your point about jobs and trains, is effectively the causation vs correlation distinction, which is what you are in turn arguing with public transport being an inferior good.

          I’d like to think that public transport will be favoured more as it receives more investment to balance out the networks over time. This can be seen by the Rapid Transit Networks increasing patronage, examples of which are the requirement to run 6 car EMU on lines that have only recently had them introduced and the counter peak loading on NEX.

          When the service levels meet the expectation at a personally acceptable price point, people use the product.

        9. Good point about the “waiting in traffic” over the “driving freely”.

          But there is more to the “driving” freedom than thundering down open roads.

          A few years back I challenged a co-worker to use the bus from his home in Beachaven to our offices. He did try it, once, and agreed that even though the buses were quicker, cheaper than his V8 Holden, and more convenient, he refused to ride the bus again.

          He saw the “stuck in traffic” as not a problem, but rather as an opportunity for him to get some “me” time, to smoke as many cigarettes as he liked/ his lungs could handle, drink coffee in the morning while driving and to listen to whatever radio station as loud as he liked.

          Things he felt he could not do on the bus. He may have been right, and there is a powerful effect that being in your own space, probably as addictive to him as the nicotine in the fags he smoked.

        10. Exactly. And as the quality and utility of PT improves and attracts users it then improves the previously monopoly driving option till they reach a kind of balance, as described by Zeibots here:


          Auckland is in the great position of still having a long way to go to improve the non-driving options so we can be confident that we have plenty of road space that we are currently using inefficiently by largely only running SOVs on at the peaks. We really really shouldn’t be widening urban roads until we have brought the alternatives to much higher standards.

        11. Ok I can disagree with two Nic(k)s in one post. First anyone with a car can leave when they want to. How many people have a bus every two minutes? We just couldnt afford a system that was that good. Second yes a bus ride of 25 minutes is preferable to a car drive of 60. But you illustrate the very point that cars are preferable to most as a start point, you need to give PT a time advantage through separate lane provision to get people to change. Why is that? Well because PT is an inferior good! I dont understand the point linking inferior goods with causation. Check this page http://en.wikipedia.org/wiki/Income_elasticity_of_demand you will see they give automobiles an income elasticity of 2.98 and public transport -0.36. Positive means cars are a normal good, negative means use declines when incomes rise so PT is an inferior good. None of that has anything to do with ideological prejudices (but arguing against it probably does!)

        12. With the changes going on in the bus network redesign a lot more people are going to have a bus every 2 minutes.

          My point about causation and correlation is around the under investment in public transport that has occurred over the last 50ish years, as renewed investment into public transport starts to even out the disparities, more people will chose PT over SOV. I think that the attitudes and behaviours that label PT an inferior good will change as the service levels get better.

          I believe that everyone should have the option to chose, if you value a SOV over PT, for whatever reason, please enjoy the chose and that freedom.

          I personally chose high frequency PT (Transit) as my primary transport option.

        13. Well those income elasticity of demand numbers are derived from specific times and places. Basically the input data must be from the auto boom years, when car use and incomes were both rising in western societies. Run them again 2005-2014 and the numbers will be different. Absolutely an example of bias confirmation. And a post hoc ergo propter hoc argument.

        14. The point is it’s only an inferior good where you make it one, and not where you don’t. A blanket statement is clearly useless. Public transport is an inferior good, except when it isn’t.

          Yes, when you spend nothing on buses and have them run behind traffic they are inferior relative to your billion dollar motorway system. Spend a few hundred million on busway and it’s the opposite. Yes, sometimes you need bus lanes to stop buses getting as slowed down and made unreliable by traffic.

        15. PT without grade separation is an inferior good relative to the private car. OK.

          What about PT with the grade separation? Because thats what we are generally advocating here. Rail, busways, cycle infrastructure.

          Talking about choice between a private car and a bus using the same roadspace as everyone else is bordering on pointless…

        16. Two problems here.

          1) mfwic expresses their personal opinion as universal truth, that everyone would prefer to drive. All else being equal (travel time, cost etc) i would prefer public transport because A) I can catch up and respond to overnight emails before i am even in the office. B) I don’t get stressed by traffic queues and other drivers and C) There’s a greater sense of community and belonging sharing your ride to work. But hey, maybe you are A) resisting the smartphone revolution B) don’t work for a multinational C) prefer being isolated from the masses. It’s a personal choice.
          2) You’re thought experiment suggests a place that doesn’t exist on earth, where everyone can live a short drive from work, where there is no-one else on the road, where there is unlimited parking. It’s about as relevant as asking, imagine your commute to work is the Moon to Mars. Everyone makes transport decisions in a context. And for most people their drive to work happens on roads, and roads have congestion, and limited parking options at the other end. We simply can’t afford to build a road network that allows everyone to drive congestion free to work. In the real world we add buslanes to overcrowded roads to get the most bang-for-buck from the limited space.

        17. “If you had any amount of money and lived in a fancy house in Herne Bay and parking wasnt a problem to you (as money doesnt matter) would you drive or wait for a bus?” – Not a good question to ask me. I would do neither – I would cycle. And yes regardless of weather or any other circumstance – I will always choose to cycle.

          But if I had to choose? Bus definitely – much more social and I can do other stuff while.

          I don’t cycle because of the environment or money or anything else. I just love to cycle and being stuck in a stuffy car in a traffic jam is just wasting my life.

        18. You caught it goosoid!

          Fact: Very rich people in Sydney, Melbourne, London, New York, etc., pay very big money to live in suburbs that are well served by public transport, in streets that are close to train and/or metro stations or on major (frequent) bus routes. The very poor people in those cities are forced out to suburbs that are very badly served by public transport, e.g., the suburb of Miller in south-west Sydney, which is a poster child for “locational disadvantage” because it is (presently) NOT anywhere near a train station (not walking distance), so people are forced to get clapped-out cars and pay a large % of their meagre income on car running costs.

  6. So car travel almost flat last 10 years hardly can hardly be called a blip. So what is going to happen when a widespread/smarter/faster/more frequent bus system is up and running with priority -with as much rapid transport links as possible and not held up in traffic?. Congestion, motorway building is already a false economy that we just can’t sustain or should. Now is a time for change but involves a drastic turnaround of transport heads to work together in promoting the other modes of travel with first maximising/redistributing the best use of the already extensive roading and motorway network. It’s already starting to happen -AT looking at all modes but think so much more could be done sooner within existing corridors with strategic planning it just involves one decision from the top-not the mayor and the government agencies working in opposing/different directions. If this happened first and 90% of all of the budget (yes including NZTA projects) went into these smarter/longer term modes imagine the rapid turnaround both in terms of a working system for Aucklanders to get around and the environment. A decision to give public transport priority in the current network (no limits-) -install widespread even if done by sector (south,east etc) as with current thinking but just do it not over 3 years-try 3 months get up something now(even if not the ultimate-but tuned for speed as much as possible) it will show how great it is and why we are fooled into thinking the network can’t run congestion free when it can if quick viable options are available.

    1. The network cannot run congestion free. As long as the roads exist, they will get used. However, at the moment the balance is lost. Private vehicles is what is endorsed, is what the money is spent on, with no regard to walking, cycling or public transport.
      What we need is to balance the modes. In a previous blog it was laid out perfectly by NSW transport academic Michelle Zeibots who argued: “It is basic microeconomics, people shifting between two different options until there is no advantage in shifting and equilibrium is found.” Congestion will reduce, but will not dissapear. The notion one can ‘solve’ congestion is the fallacy our roading engineers are trying to solve, which is impossible.

  7. I think we are on the same page in terms of balancing the modes-but Im suggesting that can be done widespread for peanuts with road width that is already there. In fact by giving physical priority to public transport actually promotes this mode as it should-as have more passengers per vehicle and arguably this road width should have been past public transport/cycling spending anyway-just past poor decision making giving full space to private vehicles. At least this way we are heading in a direction of a smarter network for space and I think congestion will reduce significantly the better -more attractive these other modes are. Maybe fully congestion free for all modes is impossible but it definately is impossible the way we are going. No real reason apart from politics why right now public transport widespread can’t be congestion free which will remove car dependency-monopoly on a system that needs space and has priority for 1 occupancy vehicles.

  8. As predicted a year ago – lower petrol prices will lead to a return of demand – especially in bigger engine capacity vehicles. Perhaps thanks to fracking we have reached and past the peak Prius moment 😀
    The trend is already apparent in the US – it is hard to imagine the same not happening in lil nul zulund. Cheap petrol = more cars on the road..that is a no brainer.

    1. Nope still Wrong: Car sales do not cause more driving, are not even strongly correlated to more driving. Driving is still well down in the US. Yes people have finally got round to upgrading their cars but they are still keeping them in their garages more than they used to. Peak driving is in the past, as is peak cheap C+C:

    2. You misunderstand the fundamental drivers for the levelling off and decline in demand for driving. Fuel costs play a role, of course, but they are not necessarily the most important factor.

      The first reason is that time is scarce and valuable. People are becoming unwilling to spend ever-increasing quantities of time travelling in the most unproductive manner possible. Technological changes (i.e. the rise of the information economy) has increased the opportunity cost associated with driving, but not necessarily public transport (as you can read, write and communicate while moving on a bus).

      The second reason is that space is scarce and valuable. Cars take up a lot of room, whether they’re moving or parked. Buses, trains, and bicycles don’t. There is a large opportunity cost associated with devoting lots of space to warehouse idle cars, and governments and businesses are increasingly under pressure to realise that opportunity cost – i.e. charge for parking. This will provide people with an ongoing incentive to avoid driving in many situations.

      1. Yes fairly weak correlation between gas prices and driving stats in US:

        From here: http://www.advisorperspectives.com/dshort/updates/DOT-Miles-Driven.php

        where it says:

        As is readily apparent, the correlation is fairly weak over the entire timeframe. And, despite the volatility in gasoline prices since the onset of the Great Recession, the correlation since December 2007 has been even weaker. There are profound behavioral issues apart from gasoline prices that are influencing miles traveled. These would include the demographics of an aging population in which older people drive less, continuing high unemployment, the ever-growing ability to work remote in the era of the Internet and the use of ever-growing communication technologies as a partial substitute for face-to-face interaction.

  9. http://www.fastcoexist.com/3037378/millennials-dont-drive-and-here-why-they-arent-likely-to-start-anytime-soon

    “The general trajectory we’ve been on, this 60 year driving boom, really does appear to be over,” says Phineas Baxandall, a senior policy analyst at the U.S. Public Interest Research Group, the organization that co-authored the report with the Frontier Group. An update on a previous 2012 report, the study pulls in new census data through last year, along with multiple state-specific studies and opinion polls.

  10. Are you really going to believe that people are buying more cars and bigger engine cars just to leave them at home? Why do you use ‘population adjusted’ charts when the same source you used publishes a graph showing ‘actual miles driven’. Perhaps the percentage of people driving has fallen – and will stay down – but the reality is that there is real recovery in total miles driven and that is born out in increased transport fuel demand and increased car sales. This graph is much more telling than yours https://fortunedotcom.files.wordpress.com/2014/08/screen-shot-2014-08-14-at-5-17-08-pm.png

    1. If you define “real recovery in total miles driven” as “still down 2.24% from its peak in 2007”, then yes, you’re correct.

      Meanwhile, in the world of people who can read graphs correctly, it looks like total vehicle miles travelled in the US has been totally flat for the last five years, in spite of a slow but significant economic recovery over that period.

      1. Hi Peter, I think it is clear that most fuel demand took a battering over the GFC. People out of work no longer commuted to the office or factory. What was a real knock as well was commercial transport demand. People bought less so there were less delivery trucks on the roads.
        Now two things have changed. There is real economic recovery in the US which means people are buying more products. Even the kids who buy on line still have their goods delivered to them by road transport. Secondly oil is becoming very cheap again and that is allowing Americans to ditch their compacts and return to the SUV market.
        Patrick misses the point. Some US families are buying a second car and they are using both of them. The Dad’s who were out of work downsized the family fleet but now Dad is back packing shelves at Wallmart he needs his Humvee to get to work while his wife still needs to SUV for the school run. What can also be seen from car sales data is that Americans are upsizing their cars again.
        It is not really complex, it is just human nature that we keep making the same mistakes time and time again. We are going to drive cars for as long as we have a cheap means of propulsion.

        1. The same data source was used Patrick. The difference is my graph shows actual real miles driven and yours has adjustments for population. There is no need to adjust anything as congestion is real or not real – adjusting for population doesn’t make it appear or go away.
          Making things up is a pretty cheap shot when the data supports my point and not yours.

    2. Funnily enough, often when people buy a new car they don’t keep their old one, or even if they do, they don’t drive them both at once. See how it works? Car sales and amount of driving are different measures. Too complex a distinction perhaps?

      1. But Patrick you are forgetting driverless cars. When they come out I will be able to own three or four and send them out in the peak just to annoy other people who have to travel to work!

        1. I’m sure driverless cars will compete with paperless offices for the dream of the century.

          Yes the technology is getting better, but I’m skeptical in it’s application in the medium term.

        2. Ah driverless cars… my money’s on carless drivers arriving first.

          Anyway bring them on, gonna be such fun stopping all traffic on any street anytime simply by looking to the ‘bot in charge that you might step out onto the road… they’re going to have follow all rules to the letter and err on the side of caution so will basically render city traffic pointless and finished.

          They will, if anything accelerate the car-less urban centre, as to the ‘burbs and the motorways; who cares?

  11. The MoT matrix seems to have a built-in assumption that only (private) vehicle users value liberty – as if sitting and watching the vehicle in front of you as you stop and occasionally crawl for over an hour in the morning and again in the evening is liberating!

    Watching video clips of my choice on a bus or train (or at home or anywhere, once we have workerless jobs) is liberating.

    Watching the back of some other vehicle for an hour or more is a form of torture, and should really be banned.

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