It Turns Out, Millennials Are Buying Cars

Somewhere along the way, the notion has grown that millennials don’t buy cars. Whether it’s the slew of articles by pundits who posited that this group doesn’t want to buy vehicles or the increase in usage of personal vehicle alternatives such as ride sharing companies Uber and Lyft.

However, the results of a new study indicate millennials are buying cars and they are willing to pay for better technology. A JD Power study has shown millennials are willing to pay 50 percent more for new technologies than baby boomers. Specifically, millennials were willing to pay $3,703 more per vehicle for new technology, however, baby boomers were only willing to pay $2,416 more per vehicle for the latest technology.

Millennials are set to be the largest consumer group in the United States. Millennials accounted for 28 percent of new vehicle sales in the U.S. That figure is up from 18 percent in 2010. Those figures compared with baby boomers, who made up 37 percent of new car buyers in 2014. To keep pace with a growing consumer group who will pay more for vehicles are automakers, which one insider feels need to keep pace with consumer demand. Speaking on this subject Kristen Kolodge, Director of driver interaction and human-machine interface research at JD Power said, “The auto industry is standing on its head to keep technology up to consumers’ new standards on the pace of innovation and updates. Those who haven’t done so have seen negative feedback from consumers.”

While automakers are trying to keep pace with the technology demand for younger consumers, many millennials are going the pre-owned route. In an interview with DrivingSales, Jessica Caldwell, Senior Analyst at Edmunds said that millennials are buying cars, but they are mostly used. Caldwell said, “They’re a bigger player in the used, they’re shopping used they’re buying used but it seems like the new car number is still lower I imagine that’s going to change as the oldest Millennial now is going to be 35 so I imagine that would change a little bit but we’re starting to see some of the millennials get into the market it’s just a bit slow.”

Now that the numbers seem to point to Millennials being a key component in the vehicle purchase game, what are you doing differently to market to them? Do you treat all customers the same or do you try to tailor your approach and marketing to different customers?