Key Takeaway:
- Dara Khosrowshahi noted ride-hailing apps discourage Uber Gen Z drivers from securing driver’s licenses.
- The Uber CEO’s own adult son refuses to drive due to app convenience.
- Department of Transportation data confirms a steady decline in teenage drivers since 1983.
Uber CEO Dara Khosrowshahi says rideshare services are discouraging many Uber Gen Z drivers from getting driver’s licenses, citing his own son as part of a broader shift toward app-based transportation and away from car ownership.
Uber Gen Z Drivers Decline as Rideshare Use Grows
Khosrowshahi said in a recent episode of The Verge’s Decoder podcast that his son, who is over 18, still does not have a driver’s license because ride-hailing apps make driving less necessary.
“This drives me crazy,” Khosrowshahi said. “I’m still trying to get my son to get his driver’s license, but Uber’s freed him up.”
The Uber chief said the convenience of ridesharing is “absolutely having an effect on car ownership,” especially among younger consumers living in cities with easier access to transportation alternatives.
Data from the U.S. Department of Transportation’s Federal Highway Administration shows the percentage of 18-year-olds with driver’s licenses fell from 80% in 1983 to 60% in 2022. Among 16-year-olds, licensing rates have dropped by more than one-quarter since 2000.
Researchers have also linked the trend affecting Uber Gen Z drivers to economic pressures and changing lifestyles. A 2013 University of Michigan study found many unlicensed adults cited high vehicle costs, lack of time, and reliance on others for transportation.
One 24-year-old resident of Philadelphia told The Washington Post in 2023 that driving was unnecessary because rideshare apps could handle emergencies and daily travel.
Rideshare Companies Expand Teen Services
Uber has increased its focus on younger riders in recent years. The company introduced teen accounts in 2023, allowing users under 18 to travel independently with parental oversight features, including live trip tracking and direct driver contact.
Other transportation companies are pursuing similar strategies. Lyft launched its own teen ride program earlier this year, while Waymo expanded robotaxi access for teenagers in parts of Phoenix and Los Angeles.
Lyft CEO David Risher said the company designed the feature around safety and independence for younger customers.
“Teens want independence,” Risher told Fortune earlier this year. “Parents want something reliable and safe and affordable.”
Industry analysts say Uber Gen Z drivers increasingly prioritize access over ownership, especially in urban areas where parking, fuel, and insurance costs continue to rise.
Uber Pushes Alternatives to Car Ownership
Khosrowshahi has long argued that ridesharing could reduce dependence on personal vehicles among Uber Gen Z drivers. Before Uber’s 2019 initial public offering, he compared ridesharing’s impact on transportation to streaming services disrupting cable television.
“We and our competition are slowly de-bundling what I call the car bundle,” he told CNBC in 2019.
Despite those predictions, vehicle registrations in the United States increased from roughly 263 million in 2015 to more than 284 million in 2023, according to federal transportation data. However, S&P Global data shows the average age of vehicles on American roads continues to rise, suggesting consumers are keeping cars longer instead of buying new ones.
Uber has also introduced lower-cost commuting options, including its “route share” shuttle-style feature launched last year. Critics compared the service to public transportation, though Khosrowshahi said it is intended to complement buses and trains rather than replace them.
The company continues to position ridesharing as an alternative to personal vehicle ownership for Uber Gen Z drivers, although Khosrowshahi acknowledged the transition remains gradual.
“We’re less than 3% of miles traveled on the road, even though we’re a very big company,” he said.
Visit more of our news! Visionary CIOs
