Why Don’t You Own a Car? Millennials are Driving Automakers Crazy.

MTV Scratch, a unit of the giant media company Viacom, performed a study on 3,000 Millennials (persons born from 1981 to 2001), asking them to identify and rank their most desirable brands. Shockingly not a single automaker ranked in their top 10 most desirable brands.

Mooseylvania and Great Questions, LLC, also performed qualitative research in 2014 to learn the top favorite brands of Millennials. This study, too, did not show an automaker in the top 10.

Ford came in at #19, and Chevrolet came in at #23. Yep, automakers are not ranking high on Millennials’ lists. Who did they choose? From both of these studies, Nike and Apple were in the top 10.

Automakers are scratching their heads. Why does the millennial generation have little to no interest in owning a car?

Numbers Don’t Lie.

According to AAA Foundation for Traffic Safety, the number of cars purchased by people aged 18 to 34 (Millennials), fell almost 30% (2007 to 2011). Even driving is down. Between the years 2007 to 2011, only 44% of teens obtained a driver’s license within the first year of becoming eligible. Only half of teens are licensed before turning 18.

This is a major break with the past, considering how most teens of the two previous generations would race to the DMV for their license or permit when they turned 16.

Let’s Get Real: there’s a Bigger Story about Millennials than Cars.

Research also shows that young people are getting married later in life, starting families later, and staying longer in college (when they can swing it). Millennials have also snubbed buying houses, too. They might not have a car, but they do have a phone. Hmmm. Is there a growing backlash to our previous “consumption culture?” Maybe – but that’s definitely a different article.

The Symbol of Freedom has Changed.

It wasn’t that long ago that the car was seen as the ultimate symbol of freedom. The growth of car ownership increased particularly after World War II; along with the upsurge of babies being born (hence, the name Baby Boomers). The trend of car ownership also went hand in hand with the burgeoning trends of fast food, highway construction, convenience stores, and increased nationwide travel. Without a doubt – Americans were on the move in their cars. The car was seen as the medium to get anywhere in life; philosophically and literally.

But Millennials don’t see the car through that lens. Today, Millennials are saying that they don’t need a car to experience freedom. Freedom is now the ability to touch a button and connect with friends that are hundreds of miles away or just down the street. Instant messaging, texting, and social media sites make human connection possible. Skype, Google Talk and IChat, and many other free, open source software applications have broken many barriers to communication.

According to the research firm Gartner and quoted in the New York Times, 46% of 18-34 year old drivers said they would rather have “Internet access over owning a car.”
Indeed. The Internet has revolutionized our world just like the automobile has changed history.

The Internet is the Millennials’ Mode of Transportation.

If you don’t have a car, but you have a smartphone, you can still get from Point A to Point B. New, savvy Apps, like Uber, Lyft, and ZipCar are revolutionizing car rental and ownership.

These sites work by taking your location and showing the available cars that are near you, as well as their details, and the price.

Starting at fees as low as $7.50 an hour, one can rent a fairly new Ford Focus to drive and the rates include gas and insurance (ZipCar.com Vital Stats). So, it isn’t hard to understand why these sites are becoming increasingly popular. Even more attractive is that the Zipcar App lets you unlock the car with your smartphone.

Mary Barra, GM CEO, has said of these new virtual transportation sites: “I don’t underestimate any of those companies or think they are just passing [fads].”

The Internet is not a Fad.

In fact, there is a new term, coined the Internet of Things (IoT) that refers to home-based and personal products that are “smart” because they have been engineered with internet capability. Wireless devices are trending upward and establishing new business models. Real time tracking solutions like medical products are seen as crucial in delivering immediate and personalized care. According to Gartner, there will be approximately 26 billion devices on the Internet of Things by 2020.

Let’s just say that there are extenuating circumstances why Millennials are not buying cars. But they are buying something.

Millennials’ U.S. Purchasing Power

The Millennial generation is quickly becoming an influential group of consumers. Although unemployment rates are high, this demographic overall still has mighty purchasing power. According to Mooseylvania’s Millennial Study:

U.S. Purchasing Power Stats:

Millennials: $170 Billion
Generation X: $125 Billion
Baby Boomers: $2.9 Trillion

GM and MTV Scratch

GM, like other automakers, is very interested in investing in the Millennial market. Mary Barra, GM CEO, has been working with MTV Scratch to better understand this “youth culture.” Automakers are learning through research that Millennials resonate with brands that provide them a high-quality product or service, and are especially in tune with the brand when it’s recommended by a friend.

So how does GM show the Millennial that they care about their interests?

Well, GM will be equipping their 2015 Chevrolet Malibu with 4G LTE WI-Fi connectivity. And, reducing the environmental impact of vehicles through EPA energy star ratings and offering electric and hybrid vehicles is validating and growing this relationship.

Barra has made it a top marketing objective. “We have to be part of defining the future. We don’t get to decide what it is because ultimately the customer will” (quoted in “GM investing $540M in Southeast Michigan,” Freep.com).

Thanks to research companies like MTV Scratch, automakers are learning that vehicles could use a makeover and reflect the trends, styles and movements of today rather than yesterday. In addition, the dealership structure and way of doing business may need to be revamped, too. Younger buyers, for example, often think it’s just “weird” to take a test drive with a stranger.

Weird can be Phenomenally Lucrative.

When it comes to innovation and taking risks, look at Chrysler. Chrysler’s minivan has been a stunning success for the company, a magnum opus, selling over 12 million minivans since its launch in 1983. Thirty-one years ago, there was no such thing as a hybrid. There was nothing like it in the market with its sliding doors, storage features, and removable seats. Chrysler took an epic risk, and it paid off; the minivan changed history.

Think Differently.

Although research is still being conducted and there is no fast solution for enticing the new consumer, we can glean some wisdom from Ross Martin, EVP of Viacom Media Networks and leader of MTV Scratch: “Millennials represent almost one third of humanity. They are the largest generational cohort in American history. They’re the most collaborative, technologically sophisticated, and entrepreneurial generation we have ever known. They’re transforming everything in their path – from industries to institutions to entire governments.”

What Matters to Millennials

  • High-Quality Products – 75%
  • Would Recommend – 61%
  • Fits Their Personality – 53%
  • Social Responsibility – 40%
  • Shares Similar Interests – 39%
  • Says Important Things – 31%

Top 10 Millennial Brands (2014 Study) According to Moosylvania

  1. Nike
  2. Apple
  3. Samsung
  4. Sony
  5. Walmart
  6. Target
  7. Microsoft
  8. Coca Cola
  9. Jordan
  10. Pepsi


  1. http://moosylvania.com/millennials/Moosylvania_Millennial_Study_2015.pdf
  2. http://www.retailleader.com/top-story-consumer_insights-millennials__spending_power_to_increase_by_2017-1071.html
  3. http://adage.com/article/digitalnext/millennials-party-brand-terms/236444/
  4. http://www.theatlantic.com/business/archive/2012/08/why-are-young-people-ditching-cars-for-smartphones/260801/
  5. http://www.dmv.com/blog/how-will-millennials-transform-transportation-520602
  6. http://www.freep.com/story/money/cars/general-motors/2014/10/28/gms-barra-change-next-years-last/18031587/