Recent research suggests young consumers are less interested in owning cars than their parents are. But two studies say that may not be true.
J.D. Power and Associates, best-known for its car quality ratings, says its data show that U.S. consumers under age 26 have represented an increasing proportion of retail car sales in the American market since 2009. Compared with other drivers, this group is more likely to buy a vehicle that stands out, personalize it with options and other features and agree that their vehicle says a lot about them.
These younger drivers also are more likely than average drivers to focus on vehicle handling and power, according to Power. Its conclusion: “Young drivers really do have an interest in new vehicles and are emotionally connected to the vehicle they purchase.”
Meanwhile, Deloitte finds similar interest in cars, but also greater willingness to embrace other transportation options, in its global automotive consumer study of 23,000 consumers in 19 countries. Its analysis of American Generation Y consumers—some 80 million citizens born in the 1980s and 1990s—finds 80% who say they plan to buy or lease a vehicle within five years.
But Deloitte also finds sharp differences in the attitudes that shape their decisions about mobility. Compared with other generations, Gen Y members are more concerned about the cost of ownership, convenience of travel and the driving experience. If those measures fall short, this group is more likely to abandon car ownership and switch to other modes of transportation.
Gen Y consumers are more interested than other age groups in owning cars propelled by alternative power systems such as electric-hybrid powertrains. They’re also more receptive to vehicles equipped with at least some capability to drive themselves—or to switching to alternative modes of transportation.
This group also expresses above average willingness to move closer to work or share rides if it would enable them to abandon personal vehicle ownership. Deloitte says two-thirds of American Gen Y consumers love there cars. But they’re also three times as likely as other generations to abandon ownership if costs get too high.
Key findigs Deloitte
Gen Y market potential: Over three-quarters of Gen Y consumers plan to purchase or lease a vehicle within the next five years.
Vehicle loyalty: 64% of Gen Y consumers love their cars, but are 3x more likely to abandon their vehicles if costs increase.
The customer experience: The cost and quality of the service bundle influences over two-thirds of Gen Y consumers’ purchase decision.