The auto industry is nearing a panic. The millennial generation, those who were born during the 80s and 90s, currently make up about 40% of the car buying population. The problem is, this generation is not as focused on having a car versus past generations.
Only 27% of new vehicles are purchased by 21 to 34-year-olds, according to the industry analyst CNW Market Research, down from about 38 percent in 1985. And while CNW says about a third of those lost customers have migrated to the used-vehicle market, most seem to have simply given up on owning a car altogether. The percentage of teens and twenty-somethings with drivers’ licenses has dropped in recent years, too. The disinterest might be the result of a bad economy. It might be because of a cultural shift away from cars. However, like its industry peers, General Motors is still trying to figure out how it can get Millennials off their laptops and into showrooms.
Millennials want luxury. They cannot always afford it, but they want it. AutoTrader.com reports that millennials relate to Audi more than any other automotive brand. However, when the time comes to purchase a vehicle, reality sets in and they end up with something more practical, such as a Chevrolet or Honda. In addition, even though millennials have the world at their fingertips thanks to the internet, the survey found they don’t necessarily trust their own research. Millennials, according to the survey, depend more heavily on a salesperson for information more than older generations. Forty-nine percent of Millennials said they rely on the salesperson for information on a vehicle. That is compared to generation X at 41 percent and baby boomers at 38 percent. This means that car salespeople need to be up to date and accurate on their research, as well as being reassuring to those millennial, car shoppers.
Millennials are less likely to buy a car because it was made in the U.S. than older car buyers. Only 38% of millennials surveyed said it is important to buy a car that was assembled in the U.S. That compares to 53% of gen X and 60% of baby boomers. The three top brands that younger Millennials relate to are Audi, Honda, and Mercedes-Benz. Older Millennials were similar, with Audi also at the top, followed by Mercedes-Benz, and Chevrolet. This could be due to culturalization of the younger generation, or it could simply be that a foreign brand seems hipper due to creative marketing campaigns.
Car dealerships, and lone sellers, have a lot to contend with when selling to a millennial. However, with the proper knowledge, and perhaps creative marketing, you are sure to reel in millennial sales.
Blair Thomas is the co-founder of eMerchantBroker.com the #1 High Risk Merchant Account processing company in the US. He has been in the electronic payments industry for over 10+ years. When he is not running his business he spends his time writing and producing music, which has been featured in a variety of films.0