Years ago in the industry, “somebody turns 16 every day” was our optimistic view of the future. It’s not quite the same today with Millennials (those born after 1980) and the upcoming members of Generation Z (also called the iGeneration). Today, 28% of 16-year-olds have driver’s licenses, down from about 50% 30 years ago. Just 45% of 17-year-olds have licenses, down from two thirds 30 years ago. Since 1995, the number of licensed drivers in the United States grew by 19% but in the 29-and-under age group it grew by about a third of that rate.
There are four main factors contributing to the reduction of young licensed enthusiast drivers today.
1). Years ago, the streets and the mall were the Baby Boomers’ social media sites and the car was a true “mobile device.” Cars were a means of escape and more importantly, a way to connect with friends. Today’s youth have plenty of options to connect with friends online and the car is not an important part of that. 83% of Millennials sleep with a cell phone next to the bed, ready to connect. Plus, a significant number of Millennials just have no interest in cars.
2). We’ve lost much of the traditional pathway for kids to get excited about cars, with fewer families with fathers. In 1970 there were just 3.4 million single moms with kids under 18 and today that number is over 10 million. In the US there are about 74 million children 18 years and younger and 20 million of them live in single parent homes. In fact, the US has more single-parent households than any other civilized nation in the world. NASCAR market research has discovered the same problem when it comes to selling tickets: there are fewer dads introducing their kids to racing today like years ago.
3). Graduated Driver’s License (GDL) programs enacted by states phase in the ability to have a full driver’s license. Teens must log a minimum number of hours behind the wheel before getting a license to make them safer drivers. According to the Insurance Institute for Highway Safety, best practices are a minimum intermediate license at the age of 17, a minimum permit at 16, at least 65 supervised practice hours and, during the intermediate stage, a night driving restriction starting at 8 p.m. with a ban on all teen passengers.
4). Society is seeing significant cultural change, partially related to the economy. Millennials are hard-hit by the economy with nearly 14% unemployment for those 20 to 24 years old. Millennials like to rent which is having an impact on the housing market as well. We’re becoming an increasingly urban society, with more than 82% of the US population living in urban areas, up from about 60% in 1950.
Check back tomorrow for Trend 40: Selling More Through Optimal Sequencing.
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