…It’s the Whole Car Snubbed by Millennials
Young people, who rather be online than in a car, could cost the auto industry sales of 2 million cars a year.
The rate of sales to younger adults, 18 to 34 years, fell to 11 percent in April of this year, down from 17 before the recession (in 2007), said R.L. Polk & Co.
Gen Y represents a pool of 80 million people, whose lower wages and tendency to favor smartphones over 4-wheel freedom, may cause the auto industry’s rebound to cap at about 15 million units annually, instead of returning to the 16 to 17.4 million units per year it enjoyed prerecession, according Dan Luria, an economist at Michigan Manufacturing Technology Center in Plymouth, Michigan, reports Bloomberg.
“Now, technology not only competes” with cars, Luria told Bloomberg. “It competes and wins.”
Young people are also less likely to get a driver’s license. The percentage of 20-to-24-year-olds with driver’s licenses dropped to 81 percent in 2010, down from 92 percent in1983.
But when Gen Y’ers (also called Millennials) do buy a car they are willing to pay for infotainment with better smartphone or Internet connections, according to a Deloitte study. This shows the demand for advanced technology in car electronics remains strong.