As members of Generation Y age, join the work force, have families — and, of course, purchase vehicles — many are turning to the used-car lot.
In fact, these younger buyers are purchasing used cars much more often than older generations, such as Generation X and the Baby Boomers.
That’s according to data from J.D. Power’s Power Information Network (PIN), which shows this year so far, Gen Y buyers make up 35 percent of used-vehicle sales.
That’s compared to Gen X’s portion of the used-car market, which equates to 26 percent. Baby Boomers only account for 32 percent of used-car sales during the first half of the year.
The bottom line: As Gen Y ages, they are buying more used cars.
Take these statistics for example:
In 2009, Gen Y accounted for 23 percent of used-vehicle sales, and this number jumped to 26 percent by 2010.
In 2011, Gen Y bought 31 percent of used vehicles sold in the U.S., and 31 percent in 2012.
Lastly, this number jumped to 32 percent in 2013, before increasing even more during the first half of this year. These same statistics for Gen X has hovered consistently in the 24- to 26-percent range.
According to the new study from J.D. Power, Generation Y consumers also now make up a larger percentage of U.S. new-vehicle retail sales than their older Generation X counterparts.
According to PIN data that illustrates that assertion, Gen Y has accounted for 26 percent of new-vehicle retail sales so far this year, compared to Gen X’s 24 percent share.
The largest group of buyers remain the Baby Boomers, who accounted for 38 percent of new vehicles sold during the first half of the year.
In comparison, in 2013, Gen Y accounted for 23 percent of new vehicles sold, while Gen X bought 24 percent of new vehicles during the first half of the year.
“As Gen Y consumers enter new life stages, earn higher incomes and grow their families, their ability and desire to acquire new vehicles is increasing,” said Thomas King, vice president of PIN. “As new-vehicle demand among Gen Y consumers increases, it will be important for automakers to respond to the needs of these consumers, not only in terms of the vehicle design, but also the marketing, sales and service experience.”
And the gap between Gen Y and Gen X car sales will most likely continue to grow.
According to J.D. Power, Gen Y sales volume is expected to grow 17 percent this year when compared to 2013.
On the other hand, Gen X sales volumes are only expected to jump up by 6 percent during 2014.
J.D. Power's PIN data shows which cars Gen Y shoppers are favoring.
According to the data, these younger customers are gravitating toward smaller vehicles, with compact/small vehicle segments accounting for nearly half of all Gen Y purchases.
In fact, the compact car segment is the most popular segment for Gen Y, with 20 percent of all vehicles sold to this group coming from this segment.
Gen X tends to lean toward larger vehicles, as this age group slightly favors midsize vehicles.
For Gen X, compact SUV is the most popular segment, making up 15 percent of sales to this generation.