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General Motors Sees Young Car Buyers Delaying Car Purchase

Today’s younger consumers are buying fewer cars than previous generations did in past economic recoveries, said General Motors Chief Economist Mustafa Mohatarem. Whether or not that’s because today’s younger generations are less interested in cars all around or not, is a different matter.

Some of the reasons causing some young people from buying cars are new car affordability, the overhang of student loan debt, and higher operating costs, Mohatarem told the Center for Automotive Research Management Briefing Seminars: “It’s not a permanent withdraw from the market, it’s more of a delay.”

In that regard, young car buyers seem to be missing from the market, rather than being entirely absent.

To note, Chevrolet is offering more entry-level and affordable small cars than at any time in its history with the Spark city/mini car and Spark EV electric car, the Sonic subcompact and the Cruze compact. All three, according to GM, are winning new buyers to the Chevrolet brand.

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Comments

  1. People buy what they can afford, and with wages going down the toilet its not exactly rocket science to figure this one out…

    Reply
    1. The problem is if you raise wages the price of everything goes up too including cars.

      In the end you keep chasing your tail.

      Reply
  2. I’m currently 24, and have never bought a new car (drive a 7 year old impala). I have a good job, no debt and I love in particular the new Impala and 2014 trucks. I love watching Barrett Jackson auctions, Top Gear, nascar and gt racing and anything car related. Overall I’ve noticed a few things that I think are contributing to this:

    1. Money – the cost of living, fuel prices, college/university, insurance, electronics, vacations etc all fight for people’s disposable income like cars do. Combine school debt, bad economy, no jobs and there’s no $ left for a car.

    2. Great used cars – Autoblog posted a few days back that the average age of cars is the oldest its ever been. The used market is full of great buys: lease returns, rental returns, and a more durable product than ever makes the used route really attractive to many.

    3. Culture change – the world has basically become disposable and we’re seeing the effects of a generation who have mostly grown up on computers and video games, while not learning how things work or how to repair or fix things. Many Canadian schools don’t teach hands-on shop (a travesty in itself), and many of the role models kids have don’t have the time or ability to teach kids the joy of the automotive realm. I wonder sometimes if the complexity of the modern car combined with the lower knowledge of cars is deterring potential buyers?

    Reply
    1. Well said Iceman. Im 25 myself and agree with that 100 percent.

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    2. Very well said and great observation. I’m 26 and am seeing the exact same things.

      Reply
  3. What was stated above has a lot of truth.

    I got into cars as a small child with my first Matchbox car. I never missed a race on TV and jumped at the change to help on the neighbors stock car as a gofer and later as a crew member. I learned a lot and now today make a living in the performance aftermarket industry.

    Today like the said the cost and complexity of cars are an issue not only to kids but to the rest of us.

    Also the older cars like the Chevelle SS I owned and paid $2000 for in the 80’s is worth $30K today. Even a rusted out Malibu today can get $12K. We see it at work as our customer keep getting older and older.

    The other issue today is electronics. Games, pads and computers rule the lives of many kids to the point they do not even go outside anymore. These items can be expensive and take most of their income too. They will sacrifice for these things and as long as a car just gets them to work on time or even late they are happy. We have lost several at work as every time a new game comes out they are gone for a week with online play. They use up their time playing and lose their job because they get sick and are out of time. The competition for their money is much greater.

    The fact is 60% of kids today do not get their drivers license till they are 18. I could not wait till I was 16 years old and I wanted a car as soon as I could afford one. A cherry 63 Ford Galaxie for $500 did me well and I even doubled my money when I sold it 2 years later.

    Automakers are going to have a hard time making cars cheaper. If they get too cheap it makes it difficult to make the cars appealing to any younger buyers. It will take some innovation like a small car with two seats one in front of the other. A kind of 4 wheeled Bike or some other out side the box idea.

    Hell the price for a new car is a challenge even for the older people and is proving to be a challenge to them. The average price is $36K and the average age of a car is around 11 years old because of it.

    I wish I had a simple answer here but there are none.

    Reply
  4. Iceman and Scott, you both sum it up pretty good so I’ll just say that I agree with your statements 100% and call it good, thanks

    Reply
  5. This is sad but the real telling point is when you go to Wal Mart the 40 year olds out number the 10 year olds in the Hot Wheels row.

    There is a big drive to take a kid to a car show out there to promote the hobby. Also on Wind Tunnel this week Dave Dispain said with the waning interst of many kids in cars Racing will also be affected. He came out and asked that we take our kids to the races at an early age and try to get them interested.

    It is sad but we are in Golden Era of performance cars today. We have some of the finest well sorted machines out there for sale. But we are also in the era of the decline of the love affair of the car.

    In the past what you drove defined your image and today it is what phone or pad you carry that does it for many today.

    Sad but true.

    Some want to blame it on imports, other want to blame it on the green movment that is being beaten into the kids in school. To be honest times are changing and it is for these reasons and many more. All an enthusiast can do is hope to save a slice of the market that we can enjoy.

    Reply
  6. Keep the faith guys, all is not lost. In my experience there are still a lot of kids who love cars, though like you’ve all said, there’s more competition for their attention these days. I grew up in the eighties and while there was a crowd of us who spent our summers picking our dirt bikes and old cars apart, there was also a bunch who took the bus everywhere and hung out at the mall with the girls. I never understood those guys. We need to make an impression with kids whenever we can. I have an 11 year old son who absolutely loves cars. His room is full of models and posters. He’s one kid who’ll have his permit the day he turns 16. When I’m out in my WS6, a lot of kids don’t even look up from their phones, but once in awhile I’ll come across a couple of 14 or 15 year olds who will give me the gesture to spin the tires. I usually oblige, even a chirp gets em laughin. That gives me hope.

    Reply

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