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Generation Y shows less interest in cars

Is the love affair between cars and young people starting to cool?

That could be the case, according to a recent study of auto-related online commentary among teens and young adults by J.D. Power and Associates.

Between January and August, the market research company analyzed hundreds of thousands of "conversations" on auto-related sites such as Autoblog, personal blogs and social networks such as Twitter and Facebook.

The goal was to gauge the perceptions of Generation Y (those born in the 1980s and early 1990s) toward the automotive industry in general, as well as toward specific vehicle brands. The analysis divided Gen Y into teens (12-18) and "early careerists" (22-29).

According to J.D. Power, "Online discussions by teens indicate shifts in perceptions regarding the necessity of and desire to have cars."

Part of the reason could be economic, the research company said. During the worst recession since the 1930s, the cost of owning and maintaining a car likely makes less sense than it did when gas was 30 cents a gallon and every red-blooded American teenager yearned for a Chevy Camaro or a Pontiac GTO.

"Also, with the advent of social media and other forms of electronic communities, teens perceive less of a need to physically congregate, and less of a need for a mode of transportation," the study concluded.

That can't be good news for the auto industry. "The negative perceptions of the automotive industry that teens and early careerists hold could have implications on future vehicle sales," said Chance Parker, vice president and general manager of J.D. Power and Associates Web Intelligence Division.

"Generation Y could have the greatest spending power of any generation — even surpassing that of the baby boomers. It will be essential for automakers to earn the trust and loyalty of Gen-Y consumers, who are particularly critical of brands and products."

In Japan, the first major developed country to actually experience a decline in car ownership, disinterest among young people in owning cars — especially in urban areas such as Tokyo — is cited as one of the factors behind "demotorization."

The trend already is having a serious effect on the Japanese auto industry and poses a threat to car-dependent businesses such as restaurants and retail establishments away from public transportation lines.

A J.D. Power analyst, however, told USA Today a few months ago that China's 1.3 billion people "are simply wild about cars." In January, monthly auto sales in China surpassed those in the United States for the first time.

U.S., Japanese and other automakers increasingly have been looking to China for sales growth, although the nation is also rapidly developing a homegrown stable of car companies.

Generation Y shows less interest in cars 11/10/09 [Last modified: Tuesday, November 10, 2009 3:30am]
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