Millennials are the highest percentage of people alive among the different generations. Millennials are the money-spinning generation hence they determine the trend of technology.
They are heavy spenders, whether it’s on the latest phones, fashion, tech gadgets, games, and fast cars. It is a generation that values a good life. According to a report by CNBC close to 80% of millennials own cars and 75% of millennials who don’t own a car aspire to own one now.
Car manufacturers are responding to the preferences of this generation by spending a lot on new technology.
According to a report by Kennedy Marketing Group, there were 2 million electric cars in 2016 but by 2030, up to 15 percent of new cars could be autonomous. This is an indication of car manufacturers to satisfy the exquisite demands of millennials for speed and finesse.
There is a perception that millennials are influencing the auto industry negatively. This belief is sponsored by the claim that millennials are driving less compared to their parents when they were in their youthful years.
This claim while it appears objective is not necessarily factual because, at face value, it fails to take into consideration certain factors that could be complicit in this reality.
For instance, factors such as economic factors, family dynamics, improvement in air travel, working from home, traffic congestions, etc are all factors that could explain the decline in driving activities among today’s generation.
Take for instance, work from home opportunities. The availability of the internet has made it easier for many to work from the comfort of their homes and earn the same or even better income than those working in formal work environments.
These categories of people will not necessarily have much need for cars except for leisure. Hence, the notion that millennials don’t love cars.
Influence of Millennials on the Automobile Industry
1. Demand for Autonomous Cars
Millennials like fancy tech gadgets and modern, electrical, high-tech cars are exactly what they expect. This is positive for the industry as it forces car manufacturers to develop greener, more eco-friendly cars but there is also another side to it.
The professions of auto mechanics and car locksmiths are challenged as many of the motor repairs done today will no longer be needed.
According to data from Get-Locksmith, traditional locksmith services like car key replacement and key fob programming are today needed by about 4 million Americans each year. With electrical cars this number will drop resulting in a decreased demand in locksmiths.
Of course, we will still need automobile repairs and people will still lock themselves out, but these professions will require different skills. The demand for autonomous cars is growing and this can be traced to the preferences of young prospective car owners.
Young people want access to the latest innovations. But only when earning opportunities begin to increase among youths that they splurge on fast cars. This is what will potentially skyrocket sales and it may be detrimental for car manufacturers who are still stuck with producing the old car models.
The demand for autonomous cars will likely be high in the developed nations due to the higher income earning potentials and a higher standard of living. It will take a long while for the developing world to catch up.
2. Car Share
One major difference between the older generation and the current generation is access to car-sharing or ride-sharing services. In the olden days, lack of a personal vehicle could imply you would be condemned to hailing public taxis.
Nowadays, an individual without a personal car could still get to enjoy similar comfort as those with a personal car. Thanks to ride-hailing platforms such as Uber, Lyft, moving from one place to another can be done even in comfort.
Knowing fully well that traffic congestion may ensue, the option of using these ride-hailing platforms appears a better alternative rather than owning a car outright.
Moreover, if the option of a ride-hailing app is not tantalizing enough then interested persons can seek out car dealerships offering temporary ownership of vehicles and then sign the required paperwork to take up temporary ownership of their preferred or available vehicle.
3. Personalized Cars
This is another way millennials are influencing the auto industry. Gone are the days when cars are purchased as designed by the manufacturer. Nowadays, vehicles can be redesigned to suit the specific preferences of the owner.
Customization of cars has risen with this generation and this phenomenon is likely to continue for the foreseeable future.
Millennials are not killing the automobile industry, they are rather changing it. Ultimately, the perception of cars as mere means of transportation is fast fizzling out.
They have transitioned to be more of a fancy tech machine that can be used to boast about wealth or simply to impress others.
The millennials have contributed meaningfully and positively to the auto industry. Their interests and demands for advanced tech cars have spurred improvement in-vehicle technology.
This would ultimately bring about improved safety of the vehicles as well as the durability of the products. It could also spur an all-round development of the auto industry and create more eco-friendly solutions.