Once thought of as nonfactors in the automotive industry, millennials have quickly become a driving force and a new study shows that the industry hasn’t kept up with the generational group’s expectations.
Born between 1981-96, the group once more interested in their phones is now showing their appreciation for cars, trucks and SUVs – like everyone else – especially when it comes to ownership. However, Cars.com recently discovered the products they’re being offered don’t match up with what they thought would be available when it was their time to buy.
“Millennials had high expectations for a futuristic automotive experience by the year 2020,” said Matt Schmitz, Cars.com assistant managing editor.
“But our research found that while the industry hasn’t advanced as quickly as they envisioned, millennials’ attitude toward automotive is extremely positive and they are the most excited among their generational counterparts to shop for their next vehicle.”
Just behind superhighways, 43% of millennial respondents believed there would be flying cars by now, and 48% believed fully autonomous vehicles would be widely available, ahead of Generation X (35%) and baby boomers (36%).
In the next decade, millennials expect fully autonomous vehicles (54%), more alternative fuel sources (46%) and over-the-air software/control updates (40%).
Less surprising is that a large percentage believe car ownership is important; however, what may be a bit of a shocker is the number: 87 percent. That’s larger than the number of Generation Xers who believe this at 86%, but both lag Baby Boomers by quite a bit at 94%.
Stunningly, the lengths they’ll go to buy a vehicle also violates the norms of their older fellow new vehicle buyers. Millennials are far more likely than boomers to take out longer-term auto loans to keep monthly payments down.
When asked about financing $25,000 at a 4.5% interest rate, the largest share of millennial respondents (26%) selected $316 per month for 96 months/8 years compared to just 16% of Boomers. Eight-year loans are not commonplace, but millennials are more concerned about monthly payment amounts while boomers are more concerned about interest rates.
Unsurprisingly millennials appear to have no qualms about shopping for and purchasing a vehicle entirely online if they could. Baby Boomers are more into performing online car-shopping tasks such as researching makes and models, determining “what I can afford” and insuring their vehicle, but are far less likely to “seal the deal” online.
Millennials are almost twice as likely as boomers (62% versus 36%) to shop for and purchase a vehicle entirely online, and they’re more likely if it includes a trial period, a return policy or free delivery service.