Traverse City Record-Eagle

Business

August 7, 2013

Auto leaders: Young people will buy cars again

TRAVERSE CITY (AP) — The auto industry says people under 34 are gradually starting to buy cars again as their economic circumstances improve.

After the Great Recession, sales of cars to young people dropped significantly. Fewer of them even bothered to get drivers licenses. Some experts surmised that the group lost interest in cars because of the prevalence of social media.

Data presented at a big industry conference in Northern Michigan on Tuesday show that young cars buyers are making a slow, if uneven, return to the market.

People age 18 to 34 accounted for more than 14 percent of the U.S. new car market just five years ago, but that plunged to 10.5 percent in 2011, to according to registration data collected by the Polk auto research firm. The figure grew to 12.3 percent last year.

Licensing rates led some industry analysts to conclude that young people, who meet constantly on Facebook and other social media, have less need to travel and aren’t interested in buying cars — even when they grow older. In 1984, nearly 80 percent of people ages 16-24 had driver’s licenses, but that fell to only 68 percent in 2010. In the next-oldest demographic group, 25- to 34-year-olds, 95 percent had licenses in 1984, but that dropped to 88 percent in 2010.

But industry executives at Tuesday’s conference had a different take.

“I don’t see any evidence that young people are actually losing interest in cars,” Mustafa Mohatarem, General Motors’ chief economist, said Tuesday at the Center for Automotive Research Management Briefing Seminars, an auto industry confab near Traverse City, Mich.

Mohatarem and others at the conference said young people put off getting licenses because they’ve had trouble getting jobs and have been living with their parents. They also didn’t buy cars due to rising car prices and higher costs to own cars, such as insurance and gasoline. Also, more enrolled in to college, where they either can’t afford cars or don’t need them, the analysts said.

Text Only

the BIZ

AP Video
US Airlines Cancel Israel Flights Obama Signs Workforce Training Law Crash Victims' Remains Reach Ukraine-held City Diplomatic Push Intensifies to End War in Gaza Obama Offers Condolences at Dutch Embassy Cat Fans Lap Up Feline Film Festival Raw: Lawmakers Scuffle in Ukraine's Parliament The Rock Finds His Inner 'Hercules' Michigan Plant's Goal: Flower and Die Raw: MH17 Passenger Remains in Kharkiv, Ukraine Raw: Israel Hits Gaza Targets, Destroys Mosques ShowBiz Minute: Hoffman, Oberst, Box Office WWII Vet Gets Medals, 70 Years Late Raw: Israel Bombs Multiple Targets in Gaza Veteran Creates Job During High Unemployment Raw: Cargo Craft Undocks From Space Station Widow: Jury Sent Big Tobacco a $23B Message New Orleans Plans to Recycle Cigarette Butts UN Security Council Calls for MH 17 Crash Probe Obama Bestows Medal of Honor on NH Veteran
Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide