Why Millennials Are Buying More Cars Than Ever
Ride-sharing companies like Uber and Lyft have become prevalent among riders in all age groups, but specifically among millennials. Instead of only using them to pick them up from a night out on the town, many are using these companies to get them to and from work, doctor appointments, and other daily activities.
This has given some industry experts reason to believe that millennials aren’t interested in cars at all, and that some may stop buying them altogether. But are millenials actually shunning cars? New studies show that line of thought couldn’t be further from the truth. In fact, millennials are buying more cars than ever.
While previous reports have touted the millennials as the cheapest generation, it may be those ride-sharing services that are causing such high car sales. On the other side of the coin, many millennials believe they need to supplement their income, and driving for Uber or Lyft is a great way to do just that. In fact, roughly one in six millennial car buyers plan to drive for Uber, Lyft, or a similar service, according to a recent report by market research firm Mintel.
This isn’t surprising information when one considers the recent study conducted by CareerBuilder, which found that about 40% of millennials take on a second job. And while we all know that a car is an asset that depreciates overtime, many millennials are buying new cars rather than used. For the purposes of complying with ride-sharing companies’ requirements, getting new and better technologies and safety features makes them a better candidate to sign on with Lyft and Uber, and potentially make more money.
Not only are millennials buying more cars than ever, they’re also buying more cars overall than other generations. In fact, the AP reported that “now the largest generation in the U.S., millennials bought 4 million cars and trucks in the U.S. last year, second only to the baby boomers. Millennials’ share of the new car market jumped to 28 percent. In the country’s biggest car market, California, millennials outpaced boomers for the first time.”
This is significant, especially coming from a generation crippled by huge student loan debt to the tune of $1.4 trillion and sky-rocketing prices in the housing market. And while you may think the housing market and the decision to buy a car aren’t related ideas, think again. According to an industry analyst for Edmunds.com, “The cost of housing and just the need for space will drive people out to places that are less dense. And less density means you need a vehicle to get around.”
With all of this information, what do car dealerships need to know in order to attract a millennial buyer? For starters, they must understand that the car buying process for a millennial is much different than a buyer in any other generation. Not only do they usually know the exact model they are looking to purchase, they also do research and practice diligence when making their choices. So before your buyer walks through the dealership doors, they’ll be highly educated on the vehicle they have their eye on.
Second, don’t assume anything about the millennial generation. This is a lesson all can learn, not just the dealerships and those in the car industry. Although it’s easy to assume, it’s crucial to collect the facts and better understand them as drivers and buyers.