05.01.2013
Automotive Buying Habits for Young Adults:
An Exploratory Study of Who They Are and Why They’re Important
Steven Thacker
Research Methods 6488
Abstract and Introduction
My area of interest and expertise is, and will always be, the automotive industry.
Growing up I was the kid in class that would draw cars in his notebook, later I became a certified
automotive technician that worked in the field repairing the cars that I loved (and loathed) to
make a living, and then finally became a graduate student researching the automotive industry
for labor statistics and building cars in my free time. Therefore I can say that I appreciate all of
the aspects in the automotive process from conceptual automotive designs, manufacturing,
vehicle reviews, advances in electrical and mechanical engineering, new vehicle sales statistics
to casually reading technical journals created for guys like me.
Therefore, in this paper I am taking my passion for the automotive industry and focusing
it on a specific research question. Throughout this paper I will critically analyze the automobile
buying habits of young consumers. You may be wondering why you should care what cars
young people are buying. If you have ever purchased a new or used vehicle, the price of that
vehicle was based on the demand for it by the general public. Meaning that, if there is a higher
demand for a certain vehicle, there will be an increased cost associated with that demand and
vice versa. The younger demographic, aged 22-30, is especially important because they can
exert a lot of influence on the automotive industry as a whole, which will be discussed in detail
throughout the paper. This demographic is considered, by the automotive industry and
journalists, as technologically savvy and environmentally conscious group. For automotive
manufacturers to capture the sales from this demographic they have to offer vehicles that are
capable of utilizing new technologies like Bluetooth, navigation-based global positioning
systems (GPS), voice activated iPod capable features, as well as hybrid electric vehicles. Gone
are the days when consumers have to buy aftermarket trinkets that plug into the 12-volt cigarette
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lighters to supplement their base model economy cars. Young consumers want more technology
and fuel efficiency in their vehicles and the auto industry is listening intently.
Vehicles are achieving increased mile per gallon (MPG) figures from a variety of
manufacturers now more than ever before in history. Efficient vehicles are a reflection of the
young car buyers that are demanding them. Therefore, it is to auto manufacturer’s benefit to
create efficient vehicles for young consumers to inspire sales.
In order to examine young automotive buyers habits’ we will need to explore several
avenues of literature. A thorough literature review has been conducted in multiple fields
including sociology, consumer economics, social theory, and a few reputable automotive
journals. The first is section of the literature we will look at is who the young people are, and
why they are important. After understanding who the young people are we will look at what
vehicles they are currently buying and why. Later, the paper will incorporate sociological theory
from David Gartman to try and understand why young people are more likely to purchase certain
vehicles compared to others. And finally we will reference the literature on what kind of
behavior we can predict from young car buyers in the future. All of this literature will help
explain the larger picture of who young automobile buyers are and why they are important.
Literature Review
The task of examining the habits of young automobile buyers is a difficult one. How does
one start an exploratory investigation? This literature review process started by looking at new
car sales figures by from the United States Census data. Following that, the search transitioned to
examining new car buying trends for young adults in automotive journals, academic research
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articles, and raw automotive sales data. After an extensive review of relevant literature, data was
examined for any overlap in car buying trends (that will be referred to as buying habits). And
finally in the discussion section, inferences from the literature will be made about what young
people are likely to buy in the future.
Who are Young Automobile Consumers?
A critical aspect to consider regarding my research question is why young people are an
important demographic. Young people, between the ages of 22 and 30 specifically, are an
important demographic to examine because they can express substantial influence on industries
with their buying power due to their, “high discretionary incomes” (Bucic, Harris, Arli, 2012,
p114). In addition, young adults in this age range have most likely finished their education and
are entering, or continuing to be a part of, the workforce. Therefore, I believe that these young
adults are more likely to be able to purchase a new vehicle than those under the age of 22.
This demographics’ importance is also related to its relative size, a general estimate of
this population size is between 31-82 million adults, using 2010 Census data1. The population
parameter of individuals aged 22-30 is continually referenced in the literature for their
importance in helping shape the automobile industry in some way (Finlay, 2012, Guyer, 2007,
Lassa, 2012, Newman, 2006, Truett et. al., 2009). The literature regards this generation of young
consumers as frugal spenders and environmentally conscious. These habits are noticed by
automotive manufacturers who respond by creating efficient vehicles that can be sold at lower
prices.
As mentioned earlier, young consumers like new technology. When shopping for a new
vehicle, young car buyers want to have the option to include the latest technology in their
vehicles (Newman, 2006, Gartman, 2003, Lass, 2012). However, this generation of frugal, young
1
This estimate was calculated by adding both age parameters 18-24 and 25-44 from the 2010 US Census data.
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consumers does not want to spend an enormous amount of money on a new vehicle. In fact,
“they’re more likely to spend the money on smartphones, tablets, laptops, and $2000-plus bikes”
(Lassa, 2012). For this reason, young car enthusiasts have become a minority population (Lassa,
2012). Therefore, manufacturers are less likely to build cars for specialty groups that view
vehicles as sport instead of transportation.
As mentioned earlier, cost is an increasingly important factor for young adults (Lassa,
2012, Newman, 2006, Truett, 2004 and 2009). Nonetheless, with an increased focus on
technology, these same young adults expect more conveniences in their new vehicles (Newman,
2006). This has caused automotive manufacturers to meet young car buyers at the cross-roads of
price and technology. The technology in economic cars has drastically improved over the years
but some new technological advances have created a barrier for younger consumers. Biller et al
says, “the most efficient way to meet environmental standards is to improve technology” (2006,
p124).
Another increasingly popular technological advance, but rather expensive, is the
technology in hybrid electric vehicles (which contain a regenerative battery system and an
internal combustion engine to drive the vehicle- therein lies the name hybrid). Although hybrid
vehicles are capable of delivering the mile per gallon (MPG) range that young consumers like,
“the main problem with hybrid vehicles is cost” (Truett, 2004, p16). The literature has noticed a
trend in young adults moving to more urban areas (Truett, 2004). And, those young adults
moving to urban areas may feel that the MPG rating of a hybrid vehicle justifies the price at the
dealership. Some hybrid vehicles can get up to 50% better fuel economy than standard internal
combustion engines in the city (Truett, 2004, p16). While fuel economy continues to be an
important factor for young consumers, it is not the most important factor.
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Vehicle Preferences for Young Car Buyers
Another factor that is critical in examining young car buyers is the actual interest expressed
by young adults to purchase new vehicles. To do that, a combination of raw data from the
Census Bureau and reference the literature was examined to get an idea of how interested young
consumers are in buying a new car.
Surprisingly, the literature found that young consumers are not as interested in buying
vehicles as past generations were (Lassa, 2012). Referencing Figure 1, we can see that except for
the large increase in auto sales from 2005-2006, there has been a steady decline in new car sales
in the US2. The literature says that some of the factors creating a lack of interest in purchasing
new vehicles deal with increasing gas prices, mounting student loan debt, and an increased
popularity to move to the city where public transportation is an option (Lassa, 2012, Cristello,
2008, Weinberger, Goetzke, 2010).
Figure 1
New Car Sales in the US by Year
New Vehicle Sales in the Millions
27
26.5
26
25.5
25
24.5
24
23.5
2005
2006
2007
Year
2008
2009
www.census.gov
2
This study does take in consideration the fact that these new car sales statistics are for the entire US population
and not just young adults.
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The Theoretical Explanation of Young Car Buyers
Literature on sociological theory also helps explain the social phenomena of buying habits
for young consumers. David Gartman wrote an article discussing the car as a cultural object and
explores the symbolism attached to passenger vehicles in the form of cultural capital. He also
references other theorists like Bourdieu to help prove his point about the cultural interpretation of
passenger vehicles.
Gartman says that the car has been an integral part of shaping the mass-consumption process
and a carrier of cultural meaning (2003). In other words, he is saying that there is a symbolic
interpretation inherent in which vehicle an individual selects. Does the vehicle selected by the
individual represent someone with increased resources, a family-focused person, someone going
through a midlife crisis, or just an individual that needs basic transportation?
Gartman incorporates a discussion of Bourdieu and cultural capital3 to emphasize his point
on the cultural meaning, like class position, associated with owning a certain vehicle. Gartman
references Bourdieu saying that, “the petty bourgeoisie sought to distinguish itself from workingclass car owners by demanding cheaper cars that imitated the look of the luxury classics
consumed by the wealthy” (2003, p5)4. Based on the literature, young consumers, or petty
bourgeoisie, being explored in this paper seem more concerned with differentiating themselves
from the luxury class, or bourgeoisie, than trying to imitate their behavior by consuming goods
conspicuously.
3
In Gartman’s article he says Bourdieu explains, “cultural objects and practices… (as) socially constructed
meanings that testify to an individual’s class position” (2003, p2).
4
For the sake of simplicity, young adults in this section of the paper will be interpreted as the petty bourgeoisie
because they have the means to purchase a new car and can express influence on the market with their buying
power. The working-class is defined in Gartman’s article as those that, “forego formal concerns and focus
exclusively on material functions (and) symbolize the lack of material resources” (2003, p2). Therefore, the
working-class is less likely to be able to purchase a new vehicle. So, we cannot categorize the working-class as
petty bourgeoisie.
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However, Garman goes on to explain, “Bourdieu’s theory of class distinction that causes
constant change in consumer culture-class imitation… (by) attempting to borrow some cultural
capital of the bourgeoisie… (as) cheap imitations of their goods” (2003, p3). Although
contradictory, we could look at the bourgeoisie as those that have technologically advanced
vehicles. Theoretically, we could say that young consumers increased demand for more
technological conveniences in their vehicles is the modern equivalent of borrowing cultural
capital from the bourgeoisie class. In addition, young consumers demand may be explained as a,
“fetish for newness and the latest fashion (as) an ideological substitute for progress” (Gartman,
2003, p8). A stalling job market for a demographic of consumers with increased student loan
debt may be reaching for a substitute of progress in their own lives through their ownership of
certain vehicles.
Finally, one could say that exploring young car buyers habits’ is also a way of examining
how young car buyers are shaping the mass-production process of the automotive manufacturing
industry. The importance lays in that fact that young car buyers make up a substantial portion of
all automobile consumers and have the ability to shape the industry. In addition, there is a
cultural meaning attached to the vehicles purchased by young consumers and this can help
explain future trends in car buying behavior.
Future Automobile Buying Behavior
There are multiple aspects to consider when examining which vehicles young consumers are
most likely to purchase. The literature helps distinguish which vehicles are likely choices for
young consumers compared to others.
Research by Chinen and Sun (2011) expect that young consumers will be inclined to
prefer a Japanese branded vehicles (including but not limit to Nissan, Toyota, Honda, Acura,
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Mazda, Mitsubishi, Subaru, Lexus, and Scion) over vehicles from other countries. They
examined developed and less developed countries and found that consumers prefer vehicles from
advanced countries (Chinen, Sun, 2011). The researchers said that “US consumers rated
Japanese product quality higher than Sweden, GB, and Canada” (Chinen, Sun, 2011, p554). In
addition, the researchers found that ethnocentrism was not a factor but that, “Americans are
rational consumers who focus on the quality of the product” (Chinen, Sun, 2011, p558). Quality
is an important factor that young consumers consider when purchasing a new vehicle (quality
refers to overall build quality, repairability, and vehicle lifespan). The literature suggests that
young car buyers are more likely to prefer imported vehicles over domestic brands. Similar
literature on automotive manufacturing in other studies substantiates these findings.
In the article by Walter, Chalupa, Harris (2009), they found that “American auto companies
are struggling to overcome the perceived lower quality image against reputation of their foreign
rivals” (p43). They expressed that, “these beliefs (of build quality) are cultivated from
advertising campaigns, aesthetics, press reports and anecdotes from friends and family” (Walter,
Chalupa, Harris, 2009, p53). Therefore, the media, as well as word-of-mouth advice from friends
and family are important contributors in being able to predict future automobile buying behavior.
For example, if a trusted family member and a friend advise you to stay away from a certain
vehicles because of a myriad of quality issues they had, you are likely to be influenced by those
opinions.
In addition, quality perception is reflected in vehicle sales and the literature says overall build
quality seems to be the most important factor in buying a new vehicle for young adults (Chinen,
Sun, 2011, Lassa, 2012, Walters, Chalupa, Harris, 2009). In fact, the daughter of a manager at
General Motors did not know what a Pontiac G6 was, and said that “her and her friends don’t
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know or care about American cars” (Guyer, 2007, p17). This anecdote reflects a larger problem
for domestic car manufacturers in reference to their quality perception.
Referencing the literature, another way to predict future behavior is to look at how auto
manufacturers market their product to consumers (Gartman, 2003, Newman, 2006, Guyer, 2007).
One way manufacturers have decided to market vehicles to younger, more environmentally
conscious, generation is by creating new vehicle classifications. Some vehicle classifications you
are more likely to be familiar with are pickup trucks (PUs), passenger cars (PCs), and sport
utility vehicles (SUVs). One new classification manufacturers created is the crossover utility
vehicles (CUVs) like the Dodge Journey, Acura MDX, and Mazda CX-7. The literature found
that younger people avoid SUVs because they are inefficient, or not environmentally friendly,
and perceived as garish (Newman, 2006). David Gartman said that “corporations often create
these markets fragmented by… age… in order to sell new products to them” (2003, p15). New
vehicle classifications allow manufacturers to create slightly different vehicles that are generally
smaller in size, but most importantly, have the ability to reshape the perceptions of certain
demographics in order to increase sales without re-inventing the passenger vehicle. Lillie Guyer
from Wards Auto said that, “when Ford Motor Co. began marketing the… Escape and… Mariner
as CUVs… sales took off” (2007, p16).
Methodology Chapter
Study Design
Throughout this paper I will conduct a critical examination of the automotive buying habits
of young adults in the United States. To perform this analysis I have thoroughly reviewed all
relevant literature on the automotive industry, consumer economics, demographics, sociological
theory, and metropolitan studies related to my research question. I have synthesized this data that I
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have compiled and will make inferences about the automotive buying behavior of young adults. In
addition, I will discuss a study design that I would like to conduct in the future to help explain the
purchases of young individuals buying new vehicles. This discussion will be largely theoretical at
this point. However, I will interchangeably discuss my theoretical research design and the literature
review that I completed on the topic.
This project used a combination of qualitative and quantitative data. A substantial part of the
discussion will rely on first-person accounts and consumer related research of people’s new car
buying experiences. In addition, quantitative data was used which I will explain in the following
paragraphs.
To better understand my research question, as an exploratory topic, new research will need to
be conducted. Although a simple random sample would be ideal to give everyone in the population
an equal chance of being chosen for the sample, my research question requires a specific age
parameter. For this reason, when I create a sample I will develop a purposive nonprobability
sample. This will allow me to gather data from, “select people who serve a certain purpose” (Aday,
2006, p128). The purpose that I am interested in is the perspectives and opinions of those
individuals buying vehicles between the ages of 22-30.
My primary analysis relied on secondary data sets found in the literature5. Using multiple
(secondary) datasets allowed me to analyze my research question across several disciplines. I
believe that this method enabled me the opportunity to conduct a multifaceted analysis that
considered more aspects of the automotive buying process sociological implications. I also looked
at consumer economics as well as social theory.
The core of my analysis relied on two datasets from the literature. The first dataset was the
Motor Vehicle Safety Scale (MVSS) for Young Drivers (Blair et. al. 2004). This dataset was critical
5
However, I will talk about a future theoretical study that I would like to design as well.
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in understanding how young drivers value safety. This data can help researchers infer the types of
vehicles young drivers are more likely to purchase in the future from a safety perspective. For
example, a Jeep Wrangler is less safe (more likely to roll over because it is top-heavy with a short
wheel-base) than a Toyota Corolla (that comes standard from the factory with ABS, SRS, and
ESC). The MVSS study was conducted by Earl H. Blair et al, and published in the American
Journal of Health Studies in 2004. This article was obtained using the SocINDEX through Joyner
Library’s EbscoHost. The second dataset I used was from an article by Rachel Weinberger and
Frank Goetzke published in the Urban Studies Journal in 2010. Their study focused on how
previous experiences affected car ownership in the United States using 2000 Census data. The
research by Weinberger and Goetzke helps me understand what factors influenced previous auto
purchases and could therefore influence future purchases. I also found this article in the SocINDEX
through Joyner Library.
Data Collection
As mentioned earlier, both of these articles were collected on-line through Joyner Library’s
SocINDEX in the EbscoHost database. Given the timeframe and resources, using online databases
through Joyner Library makes the most sense for this project. Access to these databases allows me
to carefully select articles that are relevant to my research question free of cost. However, I did
come across problems while trying to select data for my topic. The primary problem that I
encountered throughout the process was not being able to find one specific dataset that I could use
to help explain my research topic. For this reason I had to use multiple datasets, and databases for
that matter, to compile literature that was relevant to my research question and find ways to make
educated inferences from that data. In other words, finding research for my specific topic was not a
clear cut process and it involved me searching through multiple databases on EbscoHost. To address
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this issue, I decided to explain my research question with a multi-disciplinary approach which
allowed me to clearly examine most of the avenues related to the vehicle buying process.
As mentioned earlier about the exploratory nature of my research question, the collection of
my data was very comprehensive. By this I mean that when I was searching on EbscoHost I did not
limit my collections to strictly sociological databases (doing so would have yielded few results). In
addition to SocINDEX, I also have articles (which are all through EbscoHost) from EconLit (a
database focused on economic journal articles) and a few articles from reputable automotive
magazines (Ward’s Auto, Automotive News). I believe this aggregation of literature from multiple
resources does not weaken the credibility of my professional paper but elevates how
comprehensively the research question was explored.
Measurement of Variables
The variables below are in reference to the study design that I will conduct in the future to
understand the automotive buying habits of young adults. Each variable will be conceptually and
operationally defined along with examples to help better understand the concepts.
The Dependent Variable
The primary dependent variable for my research question examined young driver’s
automobile buying habits (X1). For clarity’s sake, the automobile is a passenger vehicle powered by
an internal combustion engine or hybrid electric vehicle, also called EVs (a combination of electric
motors and internal combustion engines) which I will reference as a vehicle, car, auto, or
automobile interchangeably. Conceptually, I am examining the young adult as a person between the
age ranges of 22-30. I chose this age range because I believe this demographic is most likely to have
completed their secondary education or be working full-time at this point and have the ability to
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purchase a new car. Additionally, throughout the paper I refer to young drivers as young consumers,
car buyers, automobile buyers, and young people interchangeably. In addition, buying habits are
defined as the purchase these people are likely to make. For example, someone that purchases a
Toyota when they are 16, and a Honda when they are 26, may have the buying habit of purchasing
imported cars over domestic ones. Operationally, my dependent variable can be examined by
looking at what vehicle young adults are purchasing. Or, what types of vehicles are young people
buying?
The Independent Variable
My independent variable was the consumer’s final purchase (Y). Conceptually, the final
purchase is the cognitive decision that led to the purchaser exchanging money for the vehicle of
their choice. Operationally I am examining the vehicle choice the individual chose. Or, what vehicle
did the person decide on and then purchase?
The Control Variable
I have also considered an explanatory variable X2 called the consumer’s knowledge about
the vehicle before completing the final purchase. Conceptually the consumer’s knowledge is an
aggregation of personal research conducted, word of mouth, advice given by friends, family, coworkers on the vehicle that the purchaser is interested in. Operationally, I am interested in what
knowledge the purchaser compiled before shopping for the vehicle they were interested in. Did the
purchaser research the car thoroughly by reviewing consumer reports, recall information,
automotive magazines, and/or asking friends that had similar vehicles? Or, did they drive the
vehicle at the car lot and purchase it on the spot?
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Analysis Plan
The best way to present data on sales statistics would require the use of bar graphs. Bar
graphs have a way of simplifying information so that someone can easily interpret the results right
away. I find bar graphs to be a way for experts and non-experts alike to be able to interpret
information with the least amount of confusion. Because I would like the automotive industry
(experts) as well as consumer’s (non-experts) to be aware of their buying habits, bar graphs
displaying the relationship between young consumer’s auto buying habits (X1) and their final
purchase (Y) would be most appropriate. Then I would create a statistical model and see if the
consumer’s knowledge prior to purchasing the vehicle (X2) was significant. I imagine that
controlling the consumer’s knowledge prior to the purchase would display a significant relationship.
Discussion
I believe that future researchers need to examine studies that explore buying habits based on
specific demographics. As discussed in the paper, young adults between ages 22-30 are an
important demographic for automotive manufacturers and those in the broader automotive
community to listen to. Young consumers are able to express significant influence on new car
features, styling, and economy by purchasing vehicles that fit their particular preferences and in turn
shape the automotive industry itself.
From the literature, there are some inferences that I would like to mention before concluding
the paper. First, due to the younger market of car buyers holding such an importance on build
quality, I believe that they are more likely to buy an imported, Japanese, vehicle compared to a
domestic brand. Until the perception of build quality improves for domestic brands (like General
Motors, Ford, and Dodge) I imagine this trend of buying behavior will continue in the United States.
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However, if domestic manufacturers continue to re-launch vehicles through new classifications, we
may see a quicker turnaround for young consumers coming back to domestic brand vehicles.
In the literature I noticed that not all automotive manufacturers are realizing how
important the younger generation of car buyers are in shaping their industry. Auto manufacturers
need to consider the importance of reaching young consumers before they purchase their next
vehicle. The average vehicle lifespan is around thirteen years (Olson, 2009) and on average
buyers are replacing vehicles every four years (Aizcorbe, Starr, Hickman, 2003). In addition,
research shows that 232 million passenger cars were registered in 2005 representing, “1.07
registered vehicles per person over 18 (years old)” Weinberger, Goetzke, 2010). I feel that these
statistics help outline the importance for automotive manufacturers in reaching young consumers
as they may not have to purchase a new car up to a decade after they purchase their vehicle.
For future researchers, the biggest barrier I foresee will likely be collecting and compiling
raw data on individual’s automotive buying preferences. Researchers can conduct polls on which
vehicles individuals own, in the form of quantitative data, and personal interviews and
questionnaires, to be used as qualitative data, and then analyze. This process will likely require
qualitative pilot studies to find out what kinds of questions will be most helpful in understanding
what vehicles individuals prefer over others, as well as why they prefer such vehicles. Future
researchers would be wise to gather data from a large group of young individuals. My
recommendation would be in selecting university level seniors (likely around the age of 22) or
graduate students (likely between the ages of 22-30). A large sample of these individuals would
create a snapshot of vehicle preferences that could then be generalizable to the broader, young,
population.
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There is a lot more to understand in the area of consumer automotive research and I believe
that additional research projects will provide useful data for multiple academic disciplines as well as
automotive manufacturers and automotive marketing companies. Understanding young consumer’s
automotive buying habits is just the beginning to fully understand how to create vehicles so that
consumers and manufacturers can benefit mutually.
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