That would be true if you were able to get 1% of auto buyers to instead buy cargo bikes. That just won't happen.
I think 1/10th of 1% is not an unreasonable market size and certainly large enough to build a successful business. That's what carsharing started out with, and even in it's most successful markets, it only accounts to 2-3% of all drivers.
What is more important is to get away from the car monoculture when talking about transportation. That means a mix of different options, and cars will be a part of that, probably a majority for the near future. For transportation biking to take off, it needs two things: good infrastructure and good products. We are woefully behind on both, but I think cargo bikes are good, practical product to counter the bikes as toys mentality out there.
You just need to reach a tipping point for the market to take off and have a lot more options. I don't think we are far from that now. Does that mean the streets will be full of cargo bikes and cars will be put out to pasture. No. But confronting and solving transportation problems does not require everyone to change, just enough people. Cargo bikes will be part of this solution and should not be dismissed just because the market share isn't big.