Trends Show Millennials Are Finding Alternatives to Buying Cars
Automobile manufacturers today are a little puzzled that they are unable to target millennials successfully. The younger generation has statistically been less likely to buy cars. In fact, between 2007 and 2011, there was a 30% drop in millennials purchasing vehicles. There are a few factors that could account for this.
Alternative Ways to Form Identity
People tend to spring into adulthood by purchasing a vehicle. A vehicle helps individuals relate to their social group and build an identity. But with the rise of the internet, millennials have found alternative platforms in social media. One will be more likely to develop a standing with a social group on the web and through different materials to build up their persona and presence within social circles.
They Have Practical Concerns
While some may criticize millennials, there is some wisdom in the trends they have set. Many of them are not purchasing vehicles because they need to save money to pay back their student loans. Some are spending their time in unpaid internships, leaving them unable to buy a vehicle. This will develop credentials, but leave them temporarily without luxuries like a vehicle. However, this also means that the automobile industry should not worry about millennials. They will be more likely to make these purchases after they establish their careers.
The Allure of Leasing Cars
Many have been compelled by the benefits of leasing as opposed to ownership. It is particularly attractive for those in short-term situations like college students. A lease rate is typically less expensive than a loan repayment plan. Beyond that, leases do not chauffeur a long commitment. Many car accident lawyers say having a leased vehicle is also a boon to drivers who face getting a new car after an accident. Manufacturers can overcome this by educating millennials about the drawbacks of leasing. It is far more expensive over time and the leasing organization still owns the vehicle.
Services Like Uber
Uber and Lyft can be a major benefit in metropolitan areas. They usually have pretty reasonable fees, are accessible by phone, and arrive within a couple of minutes. These services also help millennials avoid the hassle of finding a place to park. Although, research shows that young people leave metropolitan areas after they start a family. A vehicle will be a necessity at that point. This is just to reiterate the point that manufacturers do not need to be concerned about their industry. Millennials will purchase automobiles, but possibly a lot later.
Every generation is a little different. The advent of technology has really molded the behavior exhibited by millennials. That can likely explain the drop in automobile purchases. But one can expect that percentage to rise again within a few years.
Eileen O'Shanassy is a freelance writer and blogger based out of Flagstaff, AZ. She writes on a variety of topics and loves to research and write. She enjoys baking, biking, and kayaking. Check out her Twitter @eileenoshanassy.