How Many Cars Does a Young Person Own!?

It seems everyone has an anecdote today about young people and cars. I’ve heard some variation of this statement so many times over the last year: “My (son/daughter/grandchild) will never own a car. They don’t even want to get a drivers license!” While I won’t argue the facts of someone’s personal family experience, that statement seems at odds with the data trends I’ve seen. So what is the truth?

Consumer Expenditures Survey

First, let’s take a look at one credible source of data that we like to utilize to better understand consumer spending behavior. It’s called the Consumer Expenditures Survey (CES), and this is how it is described by the Bureau of Labor Statistics, the department responsible for publishing the CES.

This Consumer Expenditures Survey consists of two surveys—the quarterly Interview survey and the Diary survey—that provide information on the buying habits of American consumers, including data on their expenditures, income, and consumer unit (families and single consumers) characteristics.

Bureau of Labor Statistics

What data is included? Annual income and expenditures integrated from the Interview and Diary surveys in varying detail, classified by income, age, consumer unit size, and other demographic characteristics of consumer units.

The Data Trends

So what does the CES say about car ownership? The chart below illustrates the average number of cars owned by three different demographic groups (under 25, 25-34, and 35-44) from 1990 to 2018. Take a look:

What is interesting is that the number of cars owned by those under 25 has stayed pretty constant – about 1.1 cars per consumer unit – since 1990. Where we actually see real behavioral change is in those older demographic groups. Take a look a the chart below, which illustrates the percent change in total cars owned from 1990 to 2018.

The real change in ownership behavior is in that 35-44 year-old group. And what about that group? It is now comprised of “millennials” who were in the younger end of the age demographic ranges during the Great Recession. Perhaps their experience then, and current issues with student loan debt, continue to influence their car buying/ownership decision making.

So there is truth to the statement that “millennials” have fewer cars since the data clearly shows the trend. But we certainly don’t see support here that millennials, and especially the generations that follows, don’t want, or rather need cars at all. They either want/need – to the tune of about 1.9 cars per consumer unit.

What’s Your Strategy?

We frequently use data like this in strategic planning sessions to drive group dialogue about the present and future relationships with members – especially younger members. What is the truth today, per the data, and where do you think everything is headed?

With regard to vehicles, it certainly may be that members won’t need that third or fourth car – but then again, never say never. Some millennials are now having kids, and those kids will get older, and those kids may want to drive. What’s a family to do? Hopefully turn to their credit union for a little family vehicle planning.

Which leads me to a final point, and a second strategy question you should be grappling with now: An opportunity is there, and it will be there, so what are you going to do to get it?

If a family has to work hard to justify that extra car, whether the second or third, have you placed yourself as a trusted resource in support of that family’s personal planning dialogue? Are you offering the right tools? The right resources? The right access to your products and people?

Or, are you like so many others … simply trying to maintain the illusion that you are a purveyor of auto loans with the “best” rates, terms, and service?

If “best rates” and hope for the best is your value proposition, then it will no doubt be a bumpy road to the future for you.


Have questions? Want to talk about this? Feel free to give us a call to discuss. You can schedule a complimentary 30-min. discussion using our online scheduler here:

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