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Automakers are struggling to capture this particular age group as sales drop

Automakers are starting to see a shift in the priorities of potential young car buyers today. Gone are the days of late teens and twenty-somethings rushing to buy their first car for a taste of freedom. Instead, this age group, or Generation Y, would prefer the latest smartphone or tablet. 
 
"A vehicle is really a discretionary purchase and a secondary need versus an iPhone, mobile phone or personal computer," said Joe Vitale, an automotive consultant with Deloitte. 
 
The car is no longer a teenager or 20-year-old's only chance at freedom. This generation can now connect via smartphone, tablet or laptop no matter where they are. 


Generation Y seems to be more into fancy gadgets than monthly car payments [Image Source: softwarewithstyle.com]
 
The other issue here is that members of this age group don’t typically have fat wallets. A cash-strapped twenty-something will choose the latest gadget to keep connected with friends and family rather than buy a car, pay to keep it maintained, purchase car insurance, etc. This is obviously much easier for those that live in large cities with reliable public transportation.
 
But having the latest device over a car isn't always a frivolous choice. Many companies today keep employees connected through email, a company website or other networks. Having a mobile device almost essential for the employed or even job seekers that need to have a way for potential employers to contact them at any time.  
 
So what does this mean for the auto industry? It means that automakers have to find new ways to capture this audience. The number of U.S. auto buyers ages 18-34 dropped to 11 percent in April 2012, compared to 17 percent in April 2007, which was before the recession. A total of 14 million U.S. auto buyers ages 18-34 are expected to make a vehicle purchase in 2012, which is the best year yet since 2007, but is still a drop from the annual average of 16.8 million from 2000-2007. 


Scion xB
 
Companies like Ford and Toyota have built inexpensive, subcompact cars like the Ford Fiesta and Scion xB/xD for the frugal youngsters that make up Generation Y. Automakers have also tried to lure this age group by adding increased technology for music and social networking in their vehicles, although the U.S. Department of Transportation has been trying to eliminate unnecessary technology in vehicles to reduce distracted driving. Automakers, however, have been rebelling and adding new tech anyway in order to give the public what it wants and increase sales. 
 
But the issue remains that if this generation just doesn't have the cash or the need for a car, automakers may have to find other ways to sell to this age group. 

Source: The Detroit News



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Plus Autos Cost a Lot More
By WalksTheWalk on 8/13/2012 5:58:40 PM , Rating: 3
Phones = hundreds of dollars/euros/etc.
Cars = thousands of dollars/euros/etc.

Given that young people are cash-strapped, it stands to reason they would buy things that are just less expensive and there's a huge cost delta between phones and cars.

I get the point that people can now communicate better thus there's less of a need to be in physical proximity, but isn't it apples and oranges comparing the two?




RE: Plus Autos Cost a Lot More
By TSS on 8/13/2012 6:20:40 PM , Rating: 5
It's not just apples to oranges, it's apples to bullshit.

Cmon, REALLY?! young people are buying less cars because they want an ipad? That's the reason? That's the excuse?

No, no your right. That's true. It's the ipads and pods and intarwebs causing all dis problem lol. It clearly has nothing to do with that trillion in student loan debt. Clearly. No doubt there. Nope.

It's also generation Y who ran up the national debt, deficit, crashed the stock market, and sunk the titanic dontchaknow.

I swear if these news articles get any more ridicolous i don't think i've got enough crazy in me to respond adequatly.


RE: Plus Autos Cost a Lot More
By Uncle on 8/13/2012 6:29:14 PM , Rating: 2
This.


RE: Plus Autos Cost a Lot More
By geddarkstorm on 8/13/2012 6:33:39 PM , Rating: 4
Didn't generation Y start with those born in the 80's? Or is that the millennial generation? You know what, these things are so nebulous, I think they are basically useless. Why don't we just use age ranges?


RE: Plus Autos Cost a Lot More
By tayb on 8/13/2012 6:48:42 PM , Rating: 2
The term "generation Y" is usually used to refer to the people who were born in the 80s or 90s.


RE: Plus Autos Cost a Lot More
By TSS on 8/14/12, Rating: 0
RE: Plus Autos Cost a Lot More
By mcnabney on 8/14/2012 11:52:27 AM , Rating: 2
Greatest - 1901-1924
Silent - 1925-1945
Boomers - 1946-1964
Gen-X - 1965-1981
Gen-Y - 1982-1999 (aka -Millenials, Boomer-echo)
Internet - 2000-?

Know your place in history.


By StevoLincolnite on 8/13/2012 11:30:32 PM , Rating: 2
They could always test the theory out and bundle an ipad with a every car sold.


RE: Plus Autos Cost a Lot More
By amanojaku on 8/13/2012 6:26:16 PM , Rating: 2
Captain Obvious' findings stemmed from an earlier survey performed last year or so. It asked what young adults consider coming of age. Up until the 90's or so it used to be a car, house, and family. Now, it's a smartphone, an apartment and a job. People's goals have changed, but that's mostly because of the lousy economy. The upfront and ongoing costs of a car, house or family are just too much for most of us.


RE: Plus Autos Cost a Lot More
By someguy123 on 8/13/2012 8:45:38 PM , Rating: 2
Yeah, the real change is because of the status symbol and necessarily because of cash. Kids would want cars in the past even if they were buckets. Nowadays a smartphone is the status icon that is meant to magically reflect your maturity. I highly doubt that it's the real reason for drops in new car sales, though, especially considering the article itself points out that sales are close 2007 numbers when tablet and smartphone saturation are at an all time high.


RE: Plus Autos Cost a Lot More
By BSMonitor on 8/13/2012 9:33:29 PM , Rating: 2
More than that.. Cars are everywhere now. In the 70s and 80s, people bumming rides all the time. Now, cars are everywhere. It isn't so novel as it used to buy your first car, etc etc...

Now all it means is that you too pay too much gas and insurance.


RE: Plus Autos Cost a Lot More
By Flunk on 8/13/2012 10:48:51 PM , Rating: 2
I don't know where you live but my friends are always bumming rides off me. Maybe you've just progressed past the point in your life were your friends are all poor as hell.


"A lot of people pay zero for the cellphone ... That's what it's worth." -- Apple Chief Operating Officer Timothy Cook














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