Students are not buying as many cars as previous generations, according to researchers.
(Photo by: Josh McConnell)
By Josh McConnell
Generation Y is not buying as many automobiles as previous generations in North America, but the reasons behind this trend may be different than some suggest, a published report says.
The automotive industry is blaming this trend on a lack of interest in vehicles, according to an article in the Toronto Star.
Instead of buying cars, automotive market experts told the Star that young people are more interested in spending money on technology and smartphones.
But not everyone agrees.
“I think that is a cop out,” said Raj Seekumar, a Humber College graduate and current MBA student at Brock University.
“They are just looking for an excuse to justify their low sales in recent years,” he told Humber News.
The issue of young people buying cars was raised earlier this year in a study by the University of Michigan’s Transportation Research Institute.
Fewer drivers under the age of 35 are purchasing cars and less teens are choosing to get their driver’s license, the study said.
The study pointed to a shift in buying habits saying that “in 2007, the peak probability of buying a new vehicle per driver was for those between 35 and 44 years of age. In 2011, the peak shifted to those between 55 and 64 years of age.”
But student advocates say young people are either broke or don’t need vehicles.
“The principle reason why young people aren’t buying cars in such huge numbers is because they just can’t afford it,” said Alastair Woods, chairperson of Canadian Federation of Students Ontario.
“Here in Ontario, they pay the highest tuition fees in the country, they leave school with mortgage sized debts and have very few job prospects. So if they don’t have the money to buy a car, then why would they?”
Interest still exists
Despite what the automotive industry is trying to say, Seekumar said he agrees a lack of interest is not why students are driving fewer cars.
“I still think there is a massive amount of interest,” he said pointing to the Canadian International Autoshow in Toronto last year, noting that “it was filled with lots of young people.”
Political decisions made over the last 20 years, such as the underfunding of post-secondary education and the rising cost of living, have negatively impacted young people’s ability to live a financially stable life, said Woods.
“In real terms, wages and incomes have barely risen over the last 20 years and many students who leave school are finding it either really difficult to find a full-time stable job with a living wage or they are taking part-time contract service jobs,” he said.
But even if Generation Y had the income available to purchase a car, a vehicle isn’t high on the priority list because many “live so close to where they are working or where they are going to school,” Seekumar said.