A large number of studies have relied on macro time series or micro cross section data to analyse the demand for car ownership. In this study we analyse a unique micro panel with observations on car ownership and socioeconomic characteristics at household level during a ten year period. The data show very strong persistence in households' car ownership over time. Dynamic logit models with unobserved heterogeneity are estimated using the estimation approach recently suggested by Wooldridge. Results show that the persistence in car ownership should mainly be attributed to state dependence, while unobserved heterogeneity is less important. Small income elasticities with respect to car ownership are found when taking into account the panel nature of the data.