Cars have long been seen as a necessity in the United States; for that reason, it is surprising to note that Generation Y (also known as Millennials) are less than enthused about owning their own vehicle. In fact, recent statistics show that close to 20% of Americans from the ages of 20 to 24 do not even have a driver’s license.
Naturally, these statistics are hard for the auto industry to digest, as it vacillates between creating cars that would appeal to young people or focusing on older individuals who are more likely to be shopping for a new car in the first place.
Three Reasons Why Millennials are Not Keen on Cars
While there are many reasons why a lot of Millennials have opted to spend their money on something other than a car, three main factors stand out. These factors are worth paying attention to, as they are not likely to change or go away in the near future, and could have an impact on an important sector of the American economy for many years to come.
The first one is money. While most graduates earn an entry-level salary of about $30,000 a year, this figure has dropped by 10% after the recession. Indeed, many young people are finding it hard to get a job upon graduation or even finish college in the first place.
With less money to spend, young people are forced to cut corners, and it seems that many of them would rather give up the privilege of driving, and instead spend their extra cash on the latest smartphone or tablet.
Modern technology has also played a role in diminishing the necessity of owning a car. Young people no longer have to socialize with their friends in person; they can now do that via texting, Facebook, Twitter, Instagram, Pinterest and Skype.
It is also extremely convenient to buy anything you could ever need or want online. Given this fact, it is not surprising that more and more young people are staying home rather than going out frequently.
It is also worth noting that a large percentage of Millennials now live in urban areas rather than in the suburbs. As many large, urban areas have good public transportation options, owning a car is no longer as necessary as it was in the past. What is more, those who do decide that they need a car for a particular outing can simply rent one from popular car rental shops such as Zipcar.
What Will the Future Look Like?
While it is impossible to predict exactly what the next generation will be like, it is clear that things are not going to be lighting up for the auto industry anytime soon. Even if the economy roars back to life, many young people may opt to keep their car-free lifestyle.
Even those who do wind up purchasing a car will probably not drive as often as their parents and older siblings did, thus extending a car’s lifespan and reducing the need to buy a car every few years.
The fact that Generation Y is clearly not all that interested in car ownership has many car manufacturers and sellers worried. However, it seems that this trend may very well be here to stay, as the conditions that are making car ownership less attractive are not going away anytime soon. Given this fact, it seems that the only way car manufacturers will stay afloat is to appeal to older, more experienced drivers rather than their children or younger siblings.