For something like half a decade, the auto industry has been
fretting about whether millennials will buy cars.
The ascent of Uber and Lyft didn’t help matters, as the whole
concept of “de-ownership” gained currency.
Well, it turns out that millennials are actually completely car
Here’s Bloomberg’s David Welch:
Millennials … are
more captivated by
cars than their parents and still want
freedom of owning one, according to a new
study from San Diego
Strategic Vision Inc. That
predictions in recent years that
auto sales would suffer as
known as Generation Y, took Uber instead
buying their own vehicles.
Welch reported that the Strategic Vision Study “came
up with a Customer Love
Index” to explore how
much affection millennials did or didn’t foster for owning an
The upshot is that millennials are absolutely enamored of
cars. They’re especially fond of crossover SUVs, and that bodes
well for the auto business — this type of vehicle is more
profitable than the passenger cars that used to be the entry
point to car ownership.
Intuition and a bit of history could have told us that all
the dire prognostication about millennials and owning cars was
bogus. True, for younger folks living in big cities, owning a
vehicle can be onerous. But when millennials pair up and start to
form families, car ownership become more imperative.
Then there’s the improved economy. Jobless millennials had
no need for a commuting vehicle and no access to credit to
finance one in any case. With the US now at “full employment” —
the unemployment rate is below 5% — and auto credit flowing,
those previously unpleasant conditions have reversed.
Ultimately, because millennials make up such a large
generation, their car-buying habits will shape the auto industry
for several decades.