Automakers have blown a decade and a half falsely categorizing and throwing cheesy labels on a generation too big and diverse to be typecast.
In 2005, Jim Press, then president of Toyota Motor Sales U.S.A., told attendees at the Management Briefing Seminars in Traverse City, MI, that he loved to visit hospital maternity wards. “Every one of those little baskets is 20 purchase cycles,” he said.
Based on the assumption that Millennials, the largest and most influential demographic since Baby Boomers, would exhibit the same buying patterns as their Boomer parents, Press predicted the U.S. eventually would see 20 million annual light-vehicle sales, far exceeding 2000’s then-record sales of 17.4 million.
Eleven years later, Millennials are the largest living generation in the U.S., overtaking Baby Boomers and accounting for 75.3 million people, according to U.S. Census data and Pew Research.
But instead of turning into an army of young, brand-conscious Yuppies and supercharging vehicle sales, Millennials are not moving the needle like the auto industry hoped and prognosticators are busy making excuses.
Millennials are entering their peak car-buying years, with the oldest 35 to 38 years old, depending on who you talk to, yet WardsAuto predicts U.S. LV sales will peak this year at 17.7 million units and decline to 17.2 million in 2017.
Some forecasters say Millennials will create a historic collapse in auto sales because they don’t like cars and will reject vehicle ownership entirely in favor of car-sharing, on-demand services and, in a few years, shared autonomous vehicles.
Others say Millennials aren’t buying vehicles because many are under employed, saddled with tons of college debt and have no money.
This is all nonsense based on bogus stereotypes. Sure, some Millennials aren’t enthralled by cars and many are broke – but there are significant segments of Generation X and the Boomer generation that also are struggling financially.
In fact, Millennials bought 4 million cars and trucks in the U.S. last year, second only to Baby Boomers, according to the J.D. Power Information Network, which defines Millennials as those between 21 and 38 in 2015. Millennials’ share of the new-car market jumped to 28%. In California, Millennials bought more vehicles than Boomers for the first time. According to TransUnion, the Millennial generation also is the fastest-growing segment of auto-loan consumers.
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Author: Digital Dealer
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