Car ownership trends heading into 2017
Posted on Thursday, December 29, 2016 at 3:23:40 PM
The past 12 months have been somewhat turbulent in the vehicle financing and manufacturing sectors.
Between the rapidly evolving preferences of consumers to the unprecedentedly high accessibility to automotive financing programs, the general appearance of car ownership in the United States is changing, with plenty more trends set to further disrupt the norms that had been consistent for decades. One of the driving forces of all other trends involved in automotive purchases, financing programs and more is the millennial generation, which is now among the biggest groups in the consumer marketplace.
The Los Angeles Times recently reported that many studies have all-but proven the idea that millennials are not as interested in purchasing vehicles as older generations. For example, the news source cited data from the Federal Reserve that showed millennials purchased exponentially fewer cars than generation X and baby boomers in 2000, 2005, 2010 and 2015. From being more environmentally conscious to choosing to live in urban environments, millennials are indeed making life choices that do not necessitate owning a vehicle.
According to the Los Angeles Times, another study, this one from J.D. Power's Power Information Network, found that millennials purchased roughly 17 percent of all new cars that hit the market in 2015, but comprise 30 percent of the population, further illustrating the divide between the old and the new. What's more, the news provider pointed out that 20 percent fewer 18-year-olds currently have driver's licenses today than the figure recorded back in the 1980s, making it clear that younger millennials are moving even further away from car ownership than their older counterparts.
However, millennials did reach a common car buying age during the height of the economic recession, when a very large portion of them were living at home due to the disparaging conditions in the job market and exceptionally high costs of rent. With this in mind, millennials might begin to cover more ground in the automotive financing and purchasing arenas in the next few years, so long as economic improvements continue to prevail in the United States.
Household behaviors change
Quartz reported that household car ownership decreased for the first time since the 1960s, citing Census data, and that this is the first time on record that the metric has moved in that direction. According to the website, the slight increase in car-less households was only measured to be 0.2 percent to 9.1 percent in 2015, but could be the beginning of a very new and different trend from the early 1960s when 25 percent of households did not own a car.
At the end of the day, too many trends are involved to have a very clear perspective on how car ownership will play out in 2017, but one thing is for sure: Automotive financing programs will remain highly accessible and competitive, benefiting first-time and repeat vehicle buyers who need a loan to close the sale.