By Alex Perdikis
If the thought of thinking about statistics and demographics bores you, you aren’t alone. But, sometimes the fascinating stories behind demographics are worth a read. That’s how it is with car buying trends. Who buys which types of vehicles and why is often a look into America’s culture.
For Now, It’s the Boomers
In the United States, baby boomers account for 62 percent of new car purchases. Baby boomers take up a large part of the population and typically have more income and resources available to purchase a new car.
But, car trend experts say that millennials, those born between 1980 and 1994, will soon catch up to baby boomers, percentage-wise. That’s a surprise because millennials have a reputation for not wanting to commit to large ticket purchases. Clearly, as millennials get older, their priorities change.
People of a Certain Age
Another surprising trend is that according to research published by the Federal Reserve, the average age of a new car or truck buyer is now 53 years old. The 55 and older crowd increased their new vehicle purchasing by 15 percentage points over the last 20 years.
Several reasons for the increase in new vehicle purchases for the 55+ age group come into play. Americans live longer and healthier lives. The 55 and older age group work longer than previous generations. And, many have greater income stability than before.
Who Buys What?
More surprises appear when it comes to which age group buys what type of vehicle. A lot of so-called experts report that sedans are not popular with buyers. However, sedans are the top choice for those in the 25 to 54 age group.
What about SUVs?
“It turns out that SUVs are less popular than sedans in the 25 to 54 age range. Those who purchase new SUVs trend a bit older and they’re the top choice for those who are 65 and older.” — Alex Perdikis
Those in the 25 to 54 demographic love their pickup trucks, though. They make up 50 percent of purchases with the 55 to 64 demographic and 65 and older group splitting the rest.
You’re probably thinking, “What about the younger crowd?” Well, they don’t buy many new vehicles. The 24 and younger group is responsible for only 1 percent of sedans sold and less than 1 percent of new truck and SUV purchases.
Who Buys Electrics and Hybrids?
Energy-efficient vehicles are most popular in the 25 to 54 age group. This group buys half of all electrics and hybrids sold. The two other age groups split the rest down the middle.
What About Money?
Household income has a clear role in the types of vehicles people purchase. But, even here, there are some surprises.
The four income groups include buyers with a yearly income under $50,000, $50,000 to $74,999, $75,000 to $99,000 and $100,000 and over. You would expect the $100,000 group to purchase new vehicles more often. And, they do.
But, the second most active buying group is not the in-between earning groups, but the $50,000 and under earning group. Now that’s surprising.
Alex Perdikis, Koons of Silver Spring general manager and owner, lives in Chevy Chase with his wife and daughters.