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Why Millennials Have Gone Slower Than They Used To When Buying Cars

Baby Boomers were born to a generation that was forced to go without many things as a child. They grew up believing that material possessions are a measure of their worth.

One of those possessions was the auto, which represented freedom, independence and wealth. Many Baby Boomers considered car ownership a crucial right of passage during their teens and adults. The reality is that millennials are not as car-crazy as their Baby Boomer grandparents. They buy fewer cars, and obtain fewer driver’s permits than ever before.

This article examines what might be causing this change and how it will affect their reluctance on the roads.

WHY MILLENNIALS DON’T LOVE CARS

The average manufacturer’s suggested retail prices for the top five selling cars of 2018 were over $5,000 higher that the average cost of top five vehicles owned by millennials. The Honda Civic (the most desired vehicle among millennials), the Nissan Altima (the Honda Accord), and the Toyota Camry were all popular choices – all practical options.

Despite their smart purchases, millennials are less likely not to get married or start families, especially when they are so young compared to previous generations. So, with no children or spouses, the new generation is gravitating towards smaller, better-priced vehicles.

The millennial generation also tends to place traveling and paying back debt higher than owning their car.

This generation might not be as passionate about cars as the last. These include:

1. Millennials are often more conscious of their finances than their parents. This may make it difficult for them to buy a substantial item that is likely to lose value.

Many millennials have already accumulated student debt and don’t plan on increasing it. They also experienced the fallout of the last recession, and don’t like the idea having no savings to go with a depreciating property.

2. Ride-sharing apps allow you to summon a ride at any time you need it. This makes car ownership less necessary.

3. There are many things that can go wrong with cars: registration, service costs, repairs and parking fees.

The younger generation has grown into an era in which convenience and smart choices are more important than solutions that create tedious and expensive problems.

4. In contrast to the way that Baby Boomers saw driving, which was an end in itself and something to enjoy, millennials see it more as a way of getting from A to B and a chore. It is also dangerous.

5. The millennial generation is not like their parents. They don’t know much about how cars work and are often unable to change tires. They have no emotional attachment.

6. Millennials want authenticity.

7. Traffic congestion is worse now than ever. This makes driving less appealing for millennials.

8. Traditional cars are polluting while millennials tend to be more environmentally-aware. Although they are aware that electric cars are available, they feel there are too much to be done.

Ironically, millennials appear not to value the things held dear by Baby Boomers, but Baby Boomers are actually adopting the world of millennials. Recent research on the use of technology by seniors found that 4/5 are regular users of social networking sites.

This autonomous vehicle was driven by an AI program. It uses various sensors such GPS and radar to perceive the surrounding environment and allows it to move safely without any human input.

Perhaps millennials want self-driving cars but are reluctant to spend their hard earned money on conventional cars in the meantime.

Although it is possible, Shuman – Legal explained that true self drivable cars are still in the testing stages. Much work will be required to upgrade existing infrastructure before these cars can become commonplace.

It may boil down to the fact traditional cars are outdated technology. Millennials could find themselves in a unique position to invent a new form or transport because they aren’t as attached to them as their Baby Boomer parents.

They might still buy a car someday, but it won’t be to satisfy their love for driving or desire for status. It will serve as an investment. This will allow them to make valuable income, even though they won’t be using it.

DIGITAL SOLUTIONS AND RIDE-SHARING OPTIONS

According to the Global Automotive Consumer Study that Deloitte conducted in 2019, consumers in India felt empowered, trusting the power and benefits of digital solutions to make their commutes safer.

India has been seeing rapid growth in the use of self-drive rentals and shared mobility solutions such Uber, Ola, Ola, and Uber as ride-hailing services.

Deloitte’s study found that a significant proportion of the population doubts the need to own a vehicle. It was questioned by 51 percent of millennials and 44 percent of Gen Z, as well as 34 percent of the pre/boomers.

The report also showed that 76 percent of respondents were in favor of using connected vehicles. However, 84 per cent believe they would be extremely beneficial to provide suggestions for safer routes and updates that prevent collisions.

Deloitte concludes that the market for shared mobility has been growing.

Deloitte’s global study included 10,000 participants representing India, China China, Australia, Japan, Korea, Japan and Southeast Asia. Participants offered their views on a number of key issues facing the automotive industry.

India currently has 47 per cent of the population using their own vehicle daily, but that figure is expected rise over the next three to fifty percent.

Indian manufacturers will see this as a challenge. While sales figures might not be greatly affected, it means that a significant amount of their manufacturing processes will have adapt to cater for the fleet or aggregators.

They will need the ability to assess the needs, drives and preferences of cab aggregators as they develop shared vehicle rental programs.

Zoomcar, a partner of Volkswagen India, recently announced that they have 200 Volkswagen Polo hatchbacks available for them to rent.

Manufacturers will have the opportunity to reduce the number of potential customers by considering that more people will be using one vehicle.

However, vehicles sharing will cover greater distances every day so they will have a shorter service life than privately owned vehicles. Vehicles that have less mileage can last as long as 15 years while vehicles with a greater number of passengers may only last for four to five more years.

Final thoughts

As more people adopt shared mobility, vehicle life cycles will certainly play a big role in the outcome of the automotive industry’s financial health.

It doesn’t matter if you are interested in vehicle usage or any other aspect, there is always a new generation that brings new ideas. Younger generations ride on the wavecrest of new technologies and can’t help paving the way to new ways for living and adapting with the inevitable changes brought about by evolution and progression.

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