The Greatest Generation? For Millennials, Cars are a Yawner.

March 30, 2014

Car company dilemma: For Millenials, you are more likely to get lucky due to your networking ability online than your sweet ride.

FastCoExist:

Auto manufacturers today are scratching their heads, trying to figure out why the millennial generation has little-to-no interest in owning a car. What car makers are failing to see is that this generation’s interests and priorities have been redefined in the last two decades, pushing cars to the side while must-have personal technology products take up the fast lane.

It’s no secret the percentage of new vehicles sold to 18- to 34-year-olds has significantly dropped over the past few years. Many argue this is the result of a weak economy, that the idea of making a large car investment and getting into more debt on top of college loans is too daunting for them. But that’s not the “driving” factor, especially considering that owning a smartphone or other mobile device, with its monthly fees of network access, data plan, insurance, and app services, is almost comparable to the monthly payments required when leasing a Honda Civic.

With recent studies showing a huge decline in auto sales among the millennial marketplace, it’s no wonder auto manufacturers are in a mild state of panic, realizing they’re missing out on a generation that wields $200 billion in purchasing power. Numbers don’t lie, and over the last few years statistics have shown a significant drop in young people who own cars, as well as those with driver’s licenses–and that decline continues among the youngest millennials, meaning this is not a trend that’s going away anytime soon. From 2007 to 2011, the number of cars purchased by people aged 18 to 34, fell almost 30%, and according to a study from the AAA Foundation for Traffic Safety, only 44% of teens obtain a driver’s license within the first year of becoming eligible and just half, 54% are licensed before turning 18. This is a major break with the past, considering how most teens of the two previous generations would race to the DMV for their license or permit on the day of their 16th birthday.

Exacerbating the issue is the general misperception that millennials are lazy, privileged, and putting off adulthood. This leads many marketers down the wrong road when attempting to connect and engage with this generation. Our latest research shows that these 17-25 year olds are not who most adults think they are. In multiple studies of college millennial consumers (CMCs), our studies reveal a highly motivated, open-minded, passionate, and extremely engaged consumer. They could even be considered more practical than generations before them. For instance, one study of CMCs conducted in May of 2013 showed students using their summer jobs to set them up more securely for early adulthood. Out of more than 1,600 college students surveyed:

A full 96% were focused on making money to curtail their tuition and other college expenses.
Nearly 30% needed to make $4,000 or more for the summer.
Nearly 50% of students were engaging in some form of “paid internship,” in an effort to gain both pay and valuable job experience.
While they might appear distracted and lazy gazing at their phones, in reality, they are keenly aware of what’s happening around them, perhaps more so than other generations, and focused on their near and long-term opportunities.

GADGETS OVER WHEELS

Because millennials use technology in every facet of their lives–from mobile phones to tablets and laptops–to connect with friends and family and to get work done, the tech gadget is their most prized possession, and has a much higher value to a CMC than transportation or owning a car. Think about it: while CMCs are likely to share a car and a ride, there’s no way they would ever share their phone.

CMCs game together and hang out virtually, they don’t have that same need to physically get together as prior generations. The CMC’s popularity and relationships are defined by their online status, not their “cool ride” and they make all of their connections online. millennials search for jobs online. They prefer to coordinate dating online, and meet people through websites and apps.

Chris Erskine in the LATimes on Millenials:

Here I go thinking outside of the Xbox again. I believe that pizza is better than caviar, that Chicago is better than New York, that Venus is superior to Mars.
And I believe, sincerely and with all cheekiness aside, that the young people we sometimes dismiss as a bunch of coffee-swilling slackers will wind up being the Greatest Generation Yet, topping the one Tom Brokaw celebrated in his bestselling 1998 book.
That’s right: The current crop of young people, the millennials (hatched roughly 1982 to 2004), show all the signs of becoming the greatest generation in human history, surpassing the legendary minds of the Renaissance, or the American Revolution or Brokaw’s esteemed and very worthy WWII America.

They are inherently more adaptive, they are idealistic, they are tolerant of differences.
They are aspirational in all the right ways. At our prodding, they worked harder in high school than we ever did in college.

As a result, the older ones (26 to 33) are the best-educated segment of young adults in American history, according to a Pew Research Center study of millennials that was released in March. (One-third of that group has a four-year college degree or better.) The think tank’s sweeping study of millennials’ attitudes toward religion, race and politics also surveyed the group’s view of the future.
“Millennials are the nation’s most stubborn economic optimists,” the Pew study found. More than 8 in 10 say they have enough money to lead the lives they want, or expect to in the future. No other segment is nearly as confident.
About 49% of millennials think the nation’s best years are ahead, the survey found. That’s a higher percentage than among baby boomers (44%) and generation X (42%), the generation between boomers and millennials.
“The greatest generation yet?” asked Terry Kay, father of two millennials. “I have run it by a few friends. Their initial reaction is, ‘Why do you think that?’ Yet, when we get to talking about it, it takes on new life and we really do start to believe.”
Of course, there is that whole neediness thing that dogs young adults — that we’ve raised millions of demanding little Mozarts.
Just recently, I overheard a colleague on the phone checking a prospective intern’s reference: “Is she one of these millennials who need a lot of encouragement and validation, because some of these kids….”
A Jet Propulsion Laboratory executive laughs at how needy his young hires can be — the right lighting, a better desk — then admits that they will turn around and accomplish the most complex task in a heartbeat.
“They do expect consistent rewards,” notes a friend, Dr. Barbara Barber, who volunteers on the faculty at USC’s Keck School of Medicine and is surrounded by high achievers, including her daughter, who’s in her first year of medical school. “They don’t have a lot of self-affirmation because they always relied on teachers, coaches and parents for that.”

Are they the greatest generation?  For the sake of the planet, they’d better be.

 

 

 

 

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5 Responses to “The Greatest Generation? For Millennials, Cars are a Yawner.”


  1. […] Car company dilemma: For Millenials, you are more likely to get lucky due to your networking ability online than your sweet ride. FastCoExist: Auto manufacturers today are scratching their heads, t…  […]


  2. I guess you don’t need a car to show off your epic loot in World of Warcraft. 😉

    No doubt a lot of young people spend a lot more time on computers playing games and social media. They often meet up in games too. There is a major shift in what makes these people tick, although I must admit I also belong to this group of people. Once a gamer, always a gamer. 🙂

    Btw, “Ready Player One” by Ernest Cline is a fun book around a possible future based on this evolution. Although the backdrop is sadly pretty devastating – and no doubt the escape from reality is all the more important.


  3. The millennials of my acquaintance are congregating in cities, where cars are much less of a necessity and a lot more expensive (factoring in gas and insurance and parking). I also think declining incomes have a lot to do with declining interest in automobiles (three fifths of NY households don’t own cars, but that has been true for decades, and low income has a lot to do with that). Whether they will resume car-buying ways once mates and kids arrive and moves to the ‘burbs become necessary is a different question.

    Then again, my parent’s generation and many of my in-laws (solidly in the Boomer generation) saw cars as freedom. Their kids, who found driving mostly unpleasant (constant gridlock, unforeseen expenses, etc.) not so much.

    I mostly think it’s a good sign–I gave up my car several years ago, and that’s a minimum $8K a year hit that I don’t take anymore. If driving isn’t a part of your daily life, it’s really expensive.


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