Young buyers are few and far between
The much-coveted new vehicle buyers age 18-34, sometimes referred to as millenials, are a dwindling group. Five years ago they accounted for 17% of all new vehicle buyers, but so far this year they comprise just 11%. In contrast, the buyer group age 55-74 has grown from 26% to 36%. Whether the younger buyer has lost interest in cars or simply doesn't have the money for a new vehicle (average price = approximately $30,000), the fact remains that the new vehicle market is skewing more and more to the older customer.
Even though only about one of every 10 buyers in 2012 is a millennial, these buyers are still sought after for two reasons: they represent seven or eight upcoming buying cycles, and, if a make can capture a young buyer, the cost of retaining that owner will be less than the cost of capturing an owner of a competitive make. Asian OEMs continue to dominate the millenial market, capturing over half of it in each of the past five years as well as 2012 (April calendar year-to-date). The domestic OEMs now have a little under 40%, up from less than a third in 2010 after the restructuring at GM and Chrysler. The European share remains small, but has been rising and is now approaching 10%.
Nine makes have made significant progress in appealing to the young buyer. Hyundai, Kia, Subaru, Buick and Mini have all seen their shares of the 18-34 buyer double over the past five years, while Ford, Audi and Volkswagen have also enjoyed sizable gains. The gains at Volkswagen are driving the gain for the overall European group.
On the other side of the coin, Mitsubishi, Suzuki, Toyota and Lincoln have all retreated in this area. Even though Toyota has lost favor with the millenials, it is still the most popular make with these buyers and has been for the past five years in a row thanks in part to the ongoing contribution of the Scion sub-brand.
Posted by Tom Libby, Lead Analyst, North American Forecasting,Polk (06.21.2012)
- New vehicle sales in Philippines surge in March 2019
- Shanghai Motor Show 2019: New energy vehicles take centre stage
- New York Auto Show 2019
- New vehicle sales in Vietnam surge Q1 2019
- SIAM urges Indian government to reduce GST on cars to 18%
- European Parliament approves post-2020 CO2 emission targets for cars and vans
- Argentine light-vehicle registrations decline 54% y/y in March
- Brazilian light-vehicle sales and production drop in March, exports continue decline
RELATED INDUSTRIES & TOPICS
An Automotive Minute from IHS Markit. Devin Lindsay discusses how fully electric vehicles in the US reach record v… https://t.co/yg2pPYjHZD
New vehicle sales in the Philippines stood at 32,173 units during March, up by 14% y/y. IHS Markit expects light-ve… https://t.co/suJ04YP2n4