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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.
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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.
(Score: 0, Troll) by Anonymous Coward on Wednesday September 14 2016, @12:45AM
Another GenX here and I don't have a license, let alone a car despite the financial ability to buy a brand new mercedes. This is attributable to being a tree-hugger, a shut-in and super-cheap. Why hang out with people and waste hard earned cash when you can fuck around with bsd and a $20 rpi? Out of everyone I know my age, I'm doing best with finances and not having a car is a big reason for that. I'll be moving to a high-density city with amazing public transportation soon so any minor inconvenience I may have felt until now will be completely gone. The age of the car is coming to an end.
(Score: 2) by TheRaven on Wednesday September 14 2016, @09:52AM
Out of everyone I know my age, I'm doing best with finances and not having a car is a big reason for that.
This sentence alone needs moderating up. Cars are a huge money sink. Even owning one that you never drive, but pay insurance and tax on, is a big cost. Put that money into savings and you can afford the deposit on a house a few years earlier (and then you're probably paying less in mortgage interests than in rent).
sudo mod me up
(Score: 3, Insightful) by VLM on Wednesday September 14 2016, @12:51PM
Humorously the only bigger money pit than a car is a house.
I've certainly never broken even and I've been in this game awhile.
You can break responses down by people who use something like Quicken (I used to) and people who don't.
So people who don't, sell a house after 10 years and subtract the current sale price from the old sale price and say "suck it renters I made $40K you'll never make"
People who do, notice that the $40K gross profit came with $3500/yr in prop tax for a decade, that $7K new roof, the $4K for new HVAC, average of $500/month more in utilities than my bachelor pad utilities cost, a couple thousand per decade on disposable appliances, etc etc etc. With the money lost I could have rented my bachelor pad apartment.
With a side dish of people who don't understand the plural of anecdote is not "actionable information". Yeah yeah I heard it all before that if you were lucky enough to have bought in the right neighborhood in SV at the right time, etc etc but 99.9999% of the population didn't, doesn't, won't, and you can wish for another bubble all you want but reality has no obligation to blow another one for you. You should expect property to be flat as it historically has been, and anything more is a windfall. Actually historically prop prices tend to reflect wage inflation, which historically has been up, and now is permanently declining, implying property prices will long term decline going forward.
Although I'm basically sitting on my front lawn every night setting $20 bills on fire, its still worth it anyway as people self select who they want to live with, and I like where I live, other than the cost. I'm just under no illusion its a huge waste of money or an anti-investment.
Where I'm currently living I estimate I've spent $293K over 16 years, not counting interest, which is about $1500/month. Zillow thinks I can sell for $187K (not a bubble area obviously). So that's a net loss of $106K. If you refuse to use quicken then you might think I profited 187-124=$63K but I haven't. $106K is less than my annual household income so I don't care much and I like where I live and its less than $7K/yr so I'm not all that horrified. Zillow thinks I can rent for $1550/mo which is disturbingly close to what I've spent to buy. I was throwing away about $6000/yr in rent at the bachelor pad, now I'm throwing away about $7000/yr at the house, its not that much worse. The bachelor pad was more luxurious than my house, however.
The actual numbers for home loanership are much worse because most of my mortgage has been interest payment. So you add like $12K/yr donation to some NYC bank and the house looks a lot worse.
Buying a house is like buying a fancy video card for your computer. Hey, its fun, and if you can afford it, its not a problem. But LOL at people who try to market it as a get rich quick (or slow) scheme. Its just a money pit.