The global automotive industry is currently facing serious economic headwinds and declining sales, leaving industry players wondering if millennials—who currently make up one-third of the world’s population—will drive the industry forward or break from past generations on vehicle ownership.
The Millennials and Auto Trends Report released today by Duff & Phelps, the global advisor that protects, restores and maximizes value for clients, shows that concerns that millennials are less interested in car ownership are greatly overstated and rooted in misconceptions about millennial car-buying patterns.
Duff & Phelps surveyed 2,150 millennials (aged 23 to 38) from across the world on car-buying preferences and the factors driving these trends.
In Europe (UK, France, Germany, Italy), the report found that most millennials already own a vehicle (79%) and half (50%) of respondents who do not currently own a car expect to in the next five years, suggesting that millennials may be responsible for turning around the struggling automotive industry in the coming years. The findings also suggest that factors including environmental concerns, city dwelling and availability of public transportation and ride-hailing services have not dampened millennial interest in vehicle ownership.
Despite the common perception of millennials as an environmentally conscious generation, gas or diesel engines are still the most preferred powertrain of choice (53%). The majority of millennials in Europe indicated that having a car is a necessity for independence (77%) and convenience (66%), and generally preferable to other, more environmentally-conscious options like ride-sharing or public transportation. When asked about their use of ride-haling services and car-sharing services, most respondents (82%) either never use these services or use them less than once a week. However, environmentally friendly options such as hybrid electric or electric only were on the rise (39%).
When analyzing the data on what European millennials are looking for in their vehicle, the most common features included: price (70%), fuel efficiency (59%), style (34%) and safety (30%).
Paul Teuten, Managing Director at Duff & Phelps, comments: “Our Millennials and Auto Trends Report challenges conventional wisdom that millennials prefer alternatives to car ownership and provides encouraging evidence that millennials will drive the automotive industry forward. The European findings, in particular with over 80% of millennials never or rarely using ride-hailing and car-sharing services, underscores this and casts doubt on the presumed notion that ride-hailing services are increasingly used by this population. The automotive industry should take note and adapt to this by continuing to make the right technological investments to satisfy millennial preferences.”
Insurance Edge Comment:
This report turns conventional wisdom on its head, and demonstrates that human nature is a force to be reckoned with when it comes to global, or local UK politics. Despite all the virtue signaling on social media many younger people aspire to the same lifestyle they see Prince Harry and Meghan enjoying, or perhaps more modestly, the contestants on Love Island. Designer label clothing and gadgets, holidays, leisure spending cash, flash German cars – the works.
Green campaigners, many of whom are simply Thatcher era Marxists dressed in new hemp-weave clothes, will have a tough time trying to convince an entitled generation that they must live as quasi-medieval serfs, grateful for vegan rice and mung beans every Friday, travelling to work on dangerous public transport and never actually owning anything.
The fact is that car – or motorcycle – ownership is true freedom; you can choose where to go, and when, plus you’re isolated from the smells, anti-social behaviour, boring conversations and tsst-tsst headphones of other annoying travellers. Those who expect younger consumers to live a Trappist monk life when compared to their car-owning, three-holidays-per-year parents, are living in a strange bubble. Expect a loud pop one day.