Many young people are delaying the purchase of their first vehicle. This trend has left car companies wondering what they need to do to attract young buyers.
It used to be more common for teenagers at the age of sixteen to have their driver's licenses, and by eighteen to own their first vehicle. Researchers from the University of Michigan Transportation Research Institute found a drop in young licensed drivers in more than half of the fifteen countries that they surveyed. Among 25 to 34-year-olds, 92% had a licence in 1999, and only 10 years later, 87% did. One-third of all licensed drivers in the United States were under the age of 30 in 1983. Today, less than a quarter of all licensed drivers are under the age of 30.
Many have assumed a lack of high earning jobs and the high cost of living discourages young people from vehicle ownership.
The real problem, it seems, is debt.
Young people between the ages of 18 and 25 are today facing on average ten years of debt. This debt is the result of student loans, credit cards and in some cases, mortgages.
A poll of more than 4,000 adults by YouGov in the United Kingdom found one in five Millennials say it will take them more than ten years to pay off personal debt and as many as 11% think they will never be able to repay it.
Young people do want to own a car
According a few market research firms, twenty-somethings without vehicles are regularly on the lookout for a good deal. This is definitely good news for automakers who have been trying to attract the twenty-something car buyers.
Budget-friendly trim packages, new vibrant colours and technology-laden dashboards are just a few youth-oriented features automakers have been designing into their vehicles.
Even with all of this effort, today's youth aren't buying as they used to. Some reports suggest more young people than ever before are moving to downtown cores in larger cities, and they find it easier to travel by public transport, Uber or city bike rather than owning a car.