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The auto industry is in a very weird place.
On the one hand, sales are booming. After several very bleak and painful years, most industry accountants have capped off their red pens and are writing almost entirely in black.
Auto technology is booming, too. New powertrains hint at a zippier, greener future, and infotainment advances mean we'll be traveling in comfort, with a greater sense of safety. Heck, in another few decades, our cars may do most of the driving themselves, leaving us to nap, chat with friends, or watch movies on our commute.
On the other hand, trouble's a-brewing. Young drivers don't seem too interested in cars, and that may not change. What does this mean for the future of an auto industry that's currently undergoing something of a renaissance? No one can say for sure.
But the contrast of these two phenomena -- that is, huge auto sales in the face of apparently declining demand -- raises an interesting question.
Who the heck is buying all these cars?
And more importantly, who's buying the Scions, Souls, Sparks, and other pint-sized models targeted at younguns?
What the? Whyzat? How did this happen?
Apparently, all those dancing hamsters have made an impression on the AARP set. According to folks interviewed by Christina Rogers, seniors appreciate cars like the Soul and the Scion xB because they're easy to maneuver and equally easy to get into and out of -- easier than big SUVs, anyway. They're nice-looking rides, too, which is attractive to Boomers who want to continue feeling youthful and desirable.
Boomers also possess massive buying power, having accumulated significant savings during their lifetimes. (It's doubtful that their kids and grandkids will fare as well.) But Boomers don't want to spend all their money in one place, and to that end, subcompacts seem like a good investment, since they're often cheaper to buy and maintain than other vehicles.
Don't be believe the anecdotal evidence? Here are a few numbers to consider: all told, seniors currently account for a whopping 42 percent of the subcompact car market. Five years ago, the figure was just 29 percent.
In contrast, Millennials (those aged 18 - 34) make up an increasingly small percentage of the subcompact market. In 2008, 17 percent of subcompacts were sold to Millennials. Now, the figure stands at just 12 percent.
Will automakers have to wait for Millennials to retire before they start buying all those cute subcompacts? We'd love to hear your thoughts, no matter which demographic you're in.