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Cars and youth

The real reason millennials don't drive or buy cars Add to ...

The text slammed into my iPhone with a youthful combination of enthusiasm, swagger, defiance, and relief: “And thus it was that the age of the N came to an end, and verily the people did rejoice ‘cause I gots my license bitches.”

Read that and tell me that today’s youth no longer have an interest in driving, that owning a vehicle no longer matters. This particular texter turned 19 in the summer, got his license as quickly as he could and has owned his own 1988 Ford Ranger pickup since the age of 16.

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He loves his truck and named it Jenny in Grade 12. And he’s completely normal. He studies sciences at the University of British Columbia, with an eye to becoming a doctor. He works part-time as a lifeguard, plays hockey Wednesday nights, volunteers at B.C. Children’s Hospital and, yes, he can spend a weekend on his Xbox, updates his Facebook page daily and has a smartphone with Beats audio.

And like most kids his age, Sam Cato relishes the freedom that comes with owning his own ride. So much so, he works part-time to pay for it. Sam is lucky to have a dad (me, full disclosure) willing to loan him the money to run his rig but in the end, he pays for it. Not everyone is so fortunate.

But we can be sure of this: if economics and government interventions were taken out of the equation, you’d find plenty of teens in love with cars; millennials in their twenties and thirties, too.

But affordability? Big issue. However, endless reams of stories bemoaning the demise of the love affair between cars and youth are – thank you Mark Twain – greatly exaggerated. The problem for young people: the price is wrong.

Don’t believe my anecdotal experiences; believe the research: “It looks like teens just can’t afford to drive,” says Highway Loss Data Institute (HLDI) vice-president Matt Moore. “Paying for their own cars, gas and insurance is hard if they can’t find a job. At the same time, kids who count on Mom and Dad to help them also may be out of luck if their parents have been affected by the recession.”

Young people have turned to transit because they can’t afford vehicle ownership. Yes, the proportion of young drivers has dropped in the last decade. But HLDI data suggests that drop has coincided with the economic downturn – which has not only hammered youth employment, but also has had an impact on parents who might otherwise help their kids take the wheel.

As HLDI points out, “There was an inverse relationship between the growing unemployment spread and the falling ratio of teen drivers to prime-age drivers.” As unemployment rises, youth driving sinks.

The evidence, instead, suggests that young people are keen to get a licence and buy a car. “Buying a car is less attainable for the young, but that quickly changes as they get older,” he said.

Research from Edmunds.com also argues that economics are at the root of what’s put an arrow into a youthful love affair with cars. Buyers 18 to 34 have an affordability issue.

“Millennials haven’t seen the same benefits in the labour, housing and stock markets that baby boomers and others have enjoyed over the last year,” said Edmunds chief economist Lacey Plache. “As a result, younger Americans across all income levels have had trouble pulling together the financial motivation to buy a new car.”

And these kids are living at home longer for both economic and social reasons, further putting off vehicle ownership.

“Young adults living at home with parents or with roommates typically have less need for their own cars because they can share them with other members of their households,” Plache said. “But young adults living on their own are more likely to need their own cars – and they’re more likely to be able to afford them.”

And yet the popular press is chanting a dirge for the youthful obsession with cars and car ownership. But research into why some young adults have yet to get a driver’s licence and have therefore put off car ownership, points to something different.

According to data from the University of Michigan’s Transportation Research Institute (UMTRI), millennials who don’t have a driver’s licence fall into three camps: those who are too busy to get one (37 per cent); those who can’t afford a car (32 per cent) and those who “mooch” a ride when necessary. So about two-thirds of those surveyed have an affordability issue. Yet it’s clear that for millennials who have the need and the resources, car ownership is as important now as it was decades ago.

Stephen Siu, 25, is a perfect example of today’s millennial. Siu, a young, Vancouver-based banker drives an older BMW, even though he lives in the city’s crowded downtown core where parking and moving about is difficult on roads clogged with mostly empty bike lanes and various concrete traffic diversions.

“I wouldn’t say I love cars, but I like them and when I have the money, I’ll get a really nice one,” says Siu, who is stretching his budget for a one-bedroom-plus-den condo. “But I need a car and I have the car I can afford. I play hockey, I work in Kerrisdale [outside the downtown core] and I have friends and family all over. I need a car. But yeah, lots of my friends can’t afford a car.”

Millennials, like their parents, will warm to car ownership when they have the money and the need. The real issue is the barriers young people face in entering the car market. Aside from the cost – for example, astronomical insurance rates – governments have implemented graduated licensing programs that have slowed the rate at which young drivers take the wheel. Thus, the love affair blossoms later.

The barriers are being overcome, however. Millennials see cars as more than a means to get around. Even with the economic issues, millennials “buy luxury cars to a similar extent or more as older buyers with the same income,” says an Edmunds report, adding “Millennial buying choices suggest an interest in cars that will translate into more purchases when economic conditions allow.”

Auto makers understand that to reach millennials, they need to develop relationships using social media and the digital world. Which is what they’re doing. As Bloomberg notes, car makers are using a blend of social media campaigns, video game placements and peer-to-peer advertising to reach new, young buyers.

“It may be a long-term endeavour to appeal to younger drivers because a lot can’t afford new vehicles now, but they will a few years down the road,” Ed Kim, an industry analyst at AutoPacific Inc., told Bloomberg.

If you have questions about driving or car maintenance, please contact our experts at globedrive@globeandmail.com.

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