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Younger Generations Propel Auto Industry Changes

Published: February 4, 2021 by Guest Contributor

Women standing in car dealership

To state the obvious, a lot has changed in the auto space in 2020. Every facet of the industry has been touched by the events of last year. Trends changed month-to-month, manufacturers temporarily halted production, consumer preferences shifted, digital retailing increased, and dealerships navigated inventory shortages. Out of the many events that defined the auto industry last year, perhaps the most intriguing has been the buying habits of Millennial and Gen Z vehicle buyers. While there continues to be much speculation about their interest in vehicle ownership, Millennials and Gen Z consumers have proven to be future trend shapers for the auto industry.

According to Experian’s Q3 2020 Market Trends Review, Millennials and Gen Z are the only two generational segments of the automotive industry seeing growth. The report found that new vehicle registrations by Millennials through the third quarter increased from 26.4% last year, to 28.6% this year. Similarly, Gen Z saw growth from 3.0% to 4.2% over the same period.

Overall, the type of vehicles both segments are interested in are not that different. In fact, Experian research shows that Millennials and Gen Z share interest in the same vehicles, but they rank them in a different order:

Graph showing millennial and Gen Z vehicle preferences

The subtle change in the order of most popular vehicles reinforces the importance of reaching out to both generations differently when creating marketing strategies. While the two generations are often clumped together, the behaviors and interests can be quite different.

So, how do you reach Millennials and Gen Z consumers? The answer lies with technology. Millennials are often credited for being the most tech savvy, while Gen Z is described as the first truly digital generation. Leveraging technology will be key to reaching this group of car buyers.

According to Pew Research, 92% of Millennials say they own a smartphone, 53% own a tablet and 86% use social media. Meanwhile, Hootsuite data found that Gen Z prefers mobile devices, using a smartphone to visit an online retail store (80%), engage on social media (95%) and purchase a product online (61%). With an increased need to go digital, OEM’s and dealers must begin shifting their marketing and sales strategies to reach these consumers in ways that appeal to their browsing and purchasing preferences.

The automotive landscape, including how car buyers shop for new vehicles, is changing. As Millennials and Gen Z continue to experience growth in automotive sales, and make up a larger segment of car buyers, it is important to tailor marketing campaigns to reach them. In doing so, OEM’s and dealers can meet consumers where they are, with offers that address their needs.

To watch the full Q3 2020 Market Trends Review, click here.

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Published: March 1, 2025 by Jon Mostajo, test user

With the National Automobile Dealers Association (NADA) Show set to kickoff later this week, it seemed fitting to explore how the shifting dynamics of the used vehicle market might impact dealers and buyers over the coming year. Shedding light on some of the registration and finance trends, as well as purchasing behaviors, can help dealers and manufacturers stay ahead of the curve. And just like that, the Special Report: Automotive Consumer Trends Report was born. As I was sifting through the data, one of the trends that stood out to me was the neck-and-neck race between Millennials and Gen X for supremacy in the used vehicle market. Five years ago, in 2019, Millennials were responsible for 33.3% of used retail registrations, followed by Gen X (29.5%) and Baby Boomers (26.8%). Since then, Baby Boomers have gradually fallen off, and Gen X continues to close the already minuscule gap. Through October 2024, Millennials accounted for 31.6%, while Gen X accounted for 30.4%. But trends can turn on a dime if the last year offers any indication. Over the last rolling 12 months (October 2023-October 2024), Gen X (31.4%) accounted for the majority of used vehicle registrations compared to Millennials (30.9%). Of course, the data is still close, and what 2025 holds is anyone’s guess, but understanding even the smallest changes in market share and consumer purchasing behaviors can help dealers and manufacturers adapt and navigate the road ahead. Although there are similarities between Millennials and Gen X, there are drastic differences, including motivations and preferences. Dealers and manufacturers should engage them on a generational level. What are they buying? Some of the data might not come as a surprise but it’s a good reminder that consumers are in different phases of life, meaning priorities change. Over the last rolling 12 months, Millennials over-indexed on used vans, accounting for more than one-third of registrations. Meanwhile, Gen X over-indexed on used trucks, making up nearly one-third of registrations, and Gen Z over-indexed on cars (accounting for 17.1% of used car registrations compared to 14.6% of overall used vehicle registrations). This isn’t surprising. Many Millennials have young families and may need extra space and functionality, while Gen Xers might prefer the versatility of the pickup truck—the ability to use it for work and personal use. On the other hand, Gen Zers are still early in their careers and gravitate towards the affordability and efficiency of smaller cars. Interestingly, although used electric vehicles only make up a small portion of used retail registrations (less than 1%), Millennials made up nearly 40% over the last rolling 12 months, followed by Gen X (32.2%) and Baby Boomers (15.8%). The market at a bird’s eye view Pulling back a bit on the used vehicle landscape, over the last rolling 12 months, CUVs/SUVs (38.9%) and cars (36.6%) accounted for the majority of used retail registrations. And nearly nine-in-ten used registrations were non-luxury vehicles. What’s more, ICE vehicles made up 88.5% of used retail registrations over the same period, while alternative-fuel vehicles (not including BEVs) made up 10.7% and electric vehicles made up 0.8%. At the finance level, we’re seeing the market shift ever so slightly. Since the beginning of the pandemic, one of the constant narratives in the industry has been the rising cost of owning a vehicle, both new and used. And while the average loan amount for a used non-luxury vehicle has gone up over the past five years, we’re seeing a gradual decline since 2022. In 2019, the average loan amount was $22,636 and spiked $29,983 in 2022. In 2024, the average loan amount reached $28,895. Much of the decline in average loan amounts can be attributed to the resurgence of new vehicle inventory, which has resulted in lower used values. With new leasing climbing over the past several quarters, we may see more late-model used inventory hit the market in the next few years, which will most certainly impact used financing. The used market moving forward Relying on historical data and trends can help dealers and manufacturers prepare and navigate the road ahead. Used vehicles will always fit the need for shoppers looking for their next vehicle; understanding some market trends will help ensure dealers and manufacturers can be at the forefront of helping those shoppers. For more information on the Special Report: Automotive Consumer Trends Report, visit Experian booth #627 at the NADA Show in New Orleans, January 23-26.

Published: January 21, 2025 by Kirsten Von Busch

Electric vehicles (EVs) are the topic of conversation in the automotive industry, but we’re continuing to see another fuel type pick up speed. With consumer demand shifting and drivers exploring more fuel-efficient options, the automotive market is leaning back into hybrids. In fact, new retail hybrid registrations grew to 11.5% through Q3 2024, from 9.5% through Q3 2023, according to Experian’s Automotive Market Trends Report: Q3 2024. Meanwhile, EVs increased from 7.7% to 8.2% year-over-year and gasoline vehicles declined to 70.4% this year, from 72.7% last year. Despite EVs gaining notable attention over recent years, some consumers may be factoring in the benefits of opting for a hybrid, such as the convenience of driving a longer distance without facing challenges as charging stations remain limited. As more manufacturers adapt to consumer needs and roll out additional vehicles, data shows 9.1% of 2024 model year vehicles in operation were attributed to hybrids, while 6.2% of 2024 model years were EVs through Q3 2024. Having more models enter the market has shifted the hybrid and plug-in hybrid electric vehicle (PHEV) market share, with the Toyota Camry making up 12.5% of the market share this quarter, a notable increase from 2.4% last year. On the other hand, the Jeep Wrangler 4xe went from having 4.5% of market share last year to 2.4% through Q3 2024. With many consumers continuing to have some concerns around EVs such as range anxiety and charging times, they’re seeking a more practical solution for their daily driving needs. The balance of fuel options provides more convenience—making hybrids an appealing choice for those wanting an EV alternative. It’s important for manufacturers to stay ahead of the competitive market as it’s constantly evolving. Leveraging the most current data can provide solutions that address both feasibility and consumer preference. To learn more about vehicle market trends, view the full Automotive Market Trends Report: Q3 2024 presentation on demand.

Published: January 10, 2025 by John Howard

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