The Billion Dollar Battle: Laid-Back Teens Vs Detroit’s “Big 3″

The other day I was talking to one of my younger brothers – he’s 18 – and asked him when the heck he was going to get his license.

He looked at me and said “someday maybe.”

I was shocked.

When I was a kid, there was nothing I wanted more than to drive. All the cool kids were doing it. More importantly, it was a badge of independence. If I had a car, I wouldn’t have to rely on my parents to take me anywhere.

I couldn’t imagine that today things were any different. Boy was I wrong.

When I asked my youngest brother – who’s 15 – if he wanted a license he tells me “why? I can just ride the bus.”

And then there’s my sister – she’s 21 and still has no car. But at least she got her license last year. Why? To drive our 70-year old grandmother to the store whenever she needs it. When I asked her why she doesn’t own a car she told me “gas prices are way too expensive. Plus I don’t want to worry about oil changes and registration and all that annoying stuff.”

I don’t get it. I can’t possibly imagine living without a car. But, increasingly, the younger generation in America cannot only picture it but they’re living it too.

According to the Federal Highway Administration, back in 1998 48% of 16-year olds had their driver’s license. By 2008, that number dropped to just 31%. But it’s not just 16 year olds. According to Ad Age, the same thing is happening to 17 and 18 year olds too. They’re also buying fewer used cars.

It used to be that a teen would work a summer job to buy his first ride. But now, kids are more concerned with buying an iPad or smart phone. According to CNW Research the used-car market for teens has dropped from 7.5 million to 4.2 million in just five years.

To be fair, some of this drop has to do with the fact that unemployment among teens is extremely high. But that’s only part of the equation. The reality is that today kids would rather sit on a bus and text away on their iPhone than pay attention to the car in front of them while cruising on down the road.

I pondered how young people could have changed so much before it dawned on me that the answer was staring me in the face. All I had to do was look in the mirror.

Even though I can afford to drive a lot, I drove about 20% less this year than last. Mainly, because I lived in an area where everything was closer. So I could walk around the block and grab a bite to eat, or even ride my bicycle for a few minutes to pick up milk at the store.

Advertising Age found that I’m not the only one. People between the age of 21 and 30 have driven around 7.7% fewer miles than they did back in 1995. And the number of people walking and riding their bikes has gone up across the board.

Furthermore, when younger adults do drive, they increasingly favor hybrid vehicles over conventional cars.

A recent study by Deloitte of over 1,500 people in the US, Western Europe, and China found that 59% of people between the ages of 19 and 31(known as Generation Y) want a hybrid car. Realizing that gas prices are probably heading up, they want a fuel-efficient car to keep the cost of ownership down.

This is huge. Estimates show that one out of every four cars bought today is purchased by someone aged 19-31. And in the next ten years, they’ll snatch up 40% of new cars.

It’s clear that the cost of fuel is one of the motivating factors for keeping people off the roads. But it’s not the only one.

The fact is the younger generation increasingly wants to live in cities.

New York is a prime example. For the first time in decades people are moving into the city, instead of out of it. In 2010 alone, over 252,000 people moved in. This is a big difference from 2006, when over 111,000 people fled the city.

Younger people are sick of the car-dependent suburbs. Especially with gas prices going through the roof. Plus, they want to be close to the action. And that’s what a city is good at.

So let me ask you this…

Would you want to drive a car in a big traffic-jammed city like New York? I sure wouldn’t. Neither do younger kids. They just ride the subway or take a bus while listening to music and relaxing.

No worry about traffic jams.

No worry about accidents.

Just wait a few minutes to catch your ride, and off you go.

And all the while, they can stay connected with their cellphone or even watch TV and movies to pass the time.

It’s definitely a sea change from a few years ago. And it’s got automakers extremely nervous.

They are starting to redesign their cars in an all-out effort to lure “young kids” into the buying experience (ever see those hip Kia commercials?). That means nicer looking cars, with more built-in electronic gadgets that can get great fuel economy.

This might lure in Gen Y buyers, but car manufacturers are going to have to try harder to get the younger generation to buy in.

Ford is going the fancy technology route. And other manufacturers like Toyota and Chrysler are following suite.

But what’s really incredible is what’s coming in the next decade – cars that drive themselves. BMW is already testing cars with the technology. And believe it or not, so is Google.

These cars would be able to navigate traffic, avoid accidents, and even talk to other “connected” vehicles on the road in order to merge lanes and do everything your average driver would.

What we’re likely to see is something unimaginable just a few years ago – car companies buying out tech companies in order to put its new technology into their cars.

At the end of the day, there is no telling exactly how the auto market will change in the years ahead. All I know is that the lazy and passive kids of today are the ones helping to change it. Detroit has never faced a challenge like this before.

So what do you think – will kids want to drive again one day? Or has the lure of getting behind the wheel and revving up entered a state of permanent decline? 

Readers Comments (6)

  1. Elliott says:

    What you say is true for the cities, but not for rural areas or small town America. 50% of the people live in the cities with mass transit but that is missing in small towns and rural areas. I grew up in the big city and never wanted a car, when I moved out to the rural area I live in I had to get a car. What the auto industry has to do is bring down the cost at the same time increase fuel efficiency and the technology and all cars should be AWD or 4WD. One final thing, look at all the truck ads, there is still a great division in the country concerning this issue. It extends itself into the culture and politics of our country. Two different ways of living and looking at society and the government, with the city people and major media outlets from the big cities dictating the direction of the country. They don’t understand how the rest of the country lives nor respects them. I’ve lived in both and there is a great divide that will not be brought together. If the media outlets, (tv, radio, publishers, music etc.) continue their course then eventually they’ll convince the young people that their economic and political vision is what’s right for the country. The people who disagree will just be dumb, stupid and hicks who don’t know anything , much like the media portrays those who don’t buy in to their ideals and vision for this country and the world.

    • Art_NJr says:

      Some good points – I grew up in a big city too, but was born a “motorhead” & was working on cars & driving before I was old enough to get a license. I’ve lived all over the U.S. & you couldn’t get me to move back into a city with a gun to my head! My son was born in a small town & like me, he likes to drive & services his vehicles himself. The fancy gizmos on new vehicles don’t appeal to either of us or just about anyone we know & a vehicle has to be utilitarian for us to be interested in it – both of us have pickup trucks, I’ve also got a (full size) van & my son’s wife has a practical car. Our friends (we live in different States) are pretty much the same – a vehicle’s load-carrying capacity & durability are a LOT more important than any of the “convenience” features on new cars & there is no public transportation @ all – nor will there ever be in our areas.

      To me, the article seems like it was written by someone in another country & I think that’s indicative of the difference between city-dwellers & rural folks – 2 completely different lifestyles. Pickups & SUV’s are worth more than cars in the areas my son & I live in & people actually use SUV’s for more than just grocery shopping, with the emphasis on “Utility” rather than “Sport”. Personally, I haven’t owned a car in 30 years, but I’ve always had a full-size pickup or van. Usually both because they serve different purposes. And when I don’t need to carry anything big or heavy I can get 50 mpg by riding my motorcycle.

      And it seems I’m not alone wanting practical vehicles over high-tech ones – I noticed a recent article about Chevy dealers not taking the hybrid/electric Volt cars alloted to them because they’re not selling well. Also, according to a report released on January 5th, of the almost 14 million vehicles Americans bought in 2011, only 20,000 were electric & if I’m not mistaken, the Ford F-150 pickup truck is still the #1 selling vehicle in the U.S.

  2. Dave says:

    When I lived in Montreal in the 1960s the cost of taking a taxi downtown and back was a lot less than the cost of parking a car downtown.
    I haven’t owned a car in 29 years. When my last one died of rust my unemployment insurance was about to run out so I decided that I could take the bus most of the time and rent a car the rest of the time. I had only taken my car to work 3 times in 5 years while working in downtown Vancouver because there was always a long lineup at the Lions Gate Bridge and the bus zipped right by the lineup. Later one of the guys in my office checked and discovered that it was cheaper to rent a car unless you needed it more than 3 days a week. On one occasion I rented a car for about $16 for a half-day so that I could go to a dance that was quite a long way out of the city. It had about 6 kilometers on the clock when I picked it up. The automatic transmission was dangerously out of adjustment. I took it back in the morning and told them what had happened. I never heard another word about it.

    I now live in a big city in Mexico. There are hundreds of buses so I don’t have to wait long. I can take a taxi downtown and back for a tiny fraction of the cost of parking downtown.

  3. John O'Connell says:

    For one thing, mass transit is now available in a lot of cities and towns where it was unheard of when I was 16.

    For another, when I was 16, or 13, or 19, until I had my own car, I hitchhiked or rode a bicycle, unless I had a good reason to take my Mother’s car. Hitchhiking today is an invitation to kidnapping and rape, or worse.

    And finally, kids today are not so interested in being physically present with each other. They connect electronically. No need for transportation of any kind.

  4. Eric says:

    For the generation mentioned, an even bigger factor isn’t mentioned.

    Kids are living at home longer than I suspect ever before. Where’s the rush to go to a college you can’t afford or pay for an apartment with only spotty income to qualify?

    Rides with mom and dad or borrowing the car are too convenient.

  5. Bonnie says:

    Just another sign that young America has been dumbed down, and more dumb than I thought! And, from the Liberal point of view, easier to nudge the mindless herds into their desired direction



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