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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: 2) by urza9814 on Wednesday September 14 2016, @10:40PM
Yeah, $75/month (plus tax) is what I pay for my contract. But I get a hell of a lot more than "a mere 1 or 2GB". Last month I used 56 gigs. That $75/month gets me 450 minutes, unlimited texts, unlimited data (no caps, no throttling) and a subsidized phone (the usual -- $200 for the latest model Galaxy or iPhone.)
My parents have two phones on a single non-contract account, and they pay around $30/month. Plus an initial $100-$200 to buy each phone (an iPhone and a Galaxy, two year old models). Although they don't use a ton of data -- that 2GB/month would cost them an extra $10-15, but that's still below $50/month.
I live in Rhode Island, they're in Pennsylvania, and we're using different providers although they're both Sprint MVNOs -- Credo Mobile and Ting.
So you can get a phone for $100 plus around fifty a month for service which you can cancel or adjust at any time if money is tight. Buy a car and you're out at least a grand, and possibly in debt which you can't just cancel. Plus gas, plus maintenance, which could be more than a hundred a month even on a car that's in pretty good shape. So maybe you buy a halfway decent used car, and the *loan payments* are about the same as a monthly cellphone bill, but there's no way in hell that the total cost of a car is that low.
You might be able to afford a *bicycle* and the associated maintenance for around the cost of a mobile phone or two...my ex commuted several miles every day by bike and she definitely spent at least $50/month maintaining that thing, repairing bent rims and punctured tires and such. She did have a cellphone though -- a two year old iPhone, cracked so badly that big chunks of the glass and LCD were missing and you could see the aluminum frame. Still on her parents' family plan, which her and her siblings helped pay for because the parents couldn't afford it either. She didn't own a PC, so that iPhone was her only means of communication. Maybe a landline would have been a bit cheaper (although it would actually be three landlines vs one family plan -- the users of that family plan were spread across three states) but a landline can't browse the web which means riding several miles to a library or something, and it can't get text messages which would have caused some issues with her job since they did some of their scheduling via texts. So the landlines would have been about the same cost as the cellphones, without providing anywhere near the same level of access. Plus the fact that the cellphone is always with you, so you don't miss a call (missing calls repeatedly could cost you your job if you're in a low wage position) and also provides a very valuable tool in case of emergency.
Cellphones vs landlines isn't a fair comparison, as the phone is also a computer and a stereo system and an emergency beacon and a watch and so much more if that's all you have. And anyone who says cellphones are the same cost as a car is ignoring at least half the cost of the car.