If you’re scanning through business news media these days, you’re bound to find coverage of the lifestyles of the Millennial generation and ridesharing giant Uber. Millennials are the biggest demographic customer segment for Uber and GM’s recent investment partner, Lyft.
Here’s the latest on these trends and how they look to be affecting the auto industry in the near future – plus the generation that is following right behind Millennials……..
- Millennials may enjoy Uber, Lyft, and carsharing services like Zipcar and Car2Go, but they are starting to buy cars in big numbers. They are getting their drivers licenses later than did Baby Boomers and Generation Xers, but it is starting to happen. Millennials’ share of the new car market jumped to 28% last year, according to a J.D. Power and Associates study. In the country’s biggest car market, California, Millennials outpaced boomers for the first time.
- A new study by Kelley Blue Book concludes that while ridesharing and carsharing services are growing rapidly in transactions, it doesn’t necessarily mean that new car sales will go away. These fast-growing transportation services may actually present an opportunity for dealers and others in the auto industry, and it goes way beyond the Millennial generation. “Ride- and car-sharing services are getting a lot of attention these days, and we wanted to better understand the current landscape of these app-fueled platforms and how they may impact both consumers and the auto industry moving forward,” said Karl Brauer, senior analyst for Kelley Blue Book, in an analysis for the report.
- Then there’s the next age demographic, Generation Z. Kelley Blue Book and AutoTrader, which are both Cox Automotive companies, conducted a study of future car-shopping habits of Gen Z, who are now ages 0 to 17. The study included a survey of 3,000 respondents, about 1,200 of which were 12 to 17 years old. That generation currently makes up 23% of the population, and its purchasing power is expected to reach $3.2 trillion by 2020, Cox Automotive said.
- Top issues for Gen Z: As far as vehicle ownership goes, there were three trends in the study that were noteworthy: they’re far more budget-conscious than the Millennials were, preferring to save money rather than spend it; more than 25% said owning an environmentally friendly vehicle is important, but it was the cost savings that shaped their opinions with saving money on gasoline being important along with lessening global warming; 43% of Gen Z respondents said they value safety features compared with 25% of Millennials surveyed when they were teens. More than half of the Gen Z respondents support self-driving vehicles, and nearly half want most cars to drive themselves in the next decade.