Very little of the demand is demand to drive a car. It's mostly demand to travel as effectively as possible.

When you build out road networks you make traveling by car more effective, increasing demand on that specific mode.

When you build out transit networks you make traveling by transit more effective, increasing demand on that specific mode.

When you have well designed cities, you reduce the demand for travel, period.

Higher population centers have favorable economics for transit vs. Personal vehicles. And are more impacted by pollutants.

Low population centers have favorable economics for personal vehicles vs. Transit. And are less impacted by pollutants.

That's a description of the dynamics anyway.

I imagine vast majority of people would agree that folks that live in the densist cities need transit, and those living in a forest need a personal vehicle. The debate occurs somewhere in between of the extremes.

Personally I'm of the opinion that we skew too far towards cars, because the true costs/externalities are harder to see, so what seems like favorable economics is actually just socializing the costs.