Are millennials less interested in cars, or less able to afford them?

Are millennials less interested in cars, or less able to afford them?

Much has been written about how millennials – those born after 1980 – would rather text than drive to see their friends. Is this idea an exaggerated stereotype, or a potential cause for concern?

GM chief economist Mustafa Mohatarem says the problem isnt lack of interest, but lack of money. With the unemployment rate for 16- to 19-year-olds nearly 25 percent, student loan debt at a record high, and estimates for the average new car ranging from more than $27,000 to $31,000, young people may simply be priced out of the market. But Mohatarem is convinced that as they get older, their employment picture will improve, they can pay off their debt, and theyll be ready to buy cars. The likely continuation of low interest rates and inflation should help.

What dealers and automakers should worry about is the generation between millennials and baby boomers, says Citi Investment Research analyst Itay Michaeli, according to the Detroit News. The companys surveys show that people aged 35 to 44 dont plan to buy additional vehicles in the next two years, mainly for financial reasons.

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