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Now We Get It: Boomers Are Buying Hip Cars For Themselves, Not Their Kids

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Mature Driver

Mature Driver

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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?

The Wall Street Journal has the answer: seniors. And they're not buying them for their kids or grandkids, they're buying them for themselves.

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.

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Comments (4)
  1. Some of these smaller cars are taller and have lower lift overs in the rear. The Soul, xB, formerly Rondo and PT Cruiser all are/were a breeze to get in and out. For me, after 5 back surgeries can't bend over so well so these taller cars make it easy on me. As much as I love many other cars, bending my neck and back over to get in and out is painful and sometimes impossible. This goes for climbing in and out of taller cars...such as my wife's SUV. Many I have talked to said the same thing and they haven't had back surgery like me. It's just easier. So I'm looking forward to a test drive in the new Buick Encore when I go to replace my current car.
     
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  2. While no one has a crystal ball for market trends, I work at a multi-line luxury auto dealership, I have an observation.

    I hear from many of our "mature" buyers that cars today have too many gadgets. While most subcompacts are fairly basic in their offerings. This plus most seniors are empty nesters and don't have the need for mid/full size autos any more.

    While many seniors have substantial financial backing, there is probably a larger segment of seniors that do not but still require transportation and the subcompact represents a huge affordability consideration.

    We'll see what the future holds for introducing a younger, less mobile but better connected generation.
     
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  3. I agree with Adam Toy. Too many unused, unnecessary, expensive gadgets. For me a "loaded" vehicle has automatic transmission, air conditioning, heater, AM/FM radio, plus power steering, brakes, windows, mirrors, and locks. Most everything else is just expensive fluff. $300 navigation systems that don't work as good as a $80 Garmin is typical of the overpricing of options.

    Yes, I'm a Boomer and I can remember when the only thing above that was standard on a vehicle was a heater.
     
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  4. I'm a boomer and I own a 1970 Dodge Challenger R/T. If I could own any car, at any price, it would be my Challenger. So fun.
     
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