Approximately 25% of people born between 1977 and 1994 (Gen Y) don’t plan on buying or leasing a vehicle, according to a survey by big four accounting firm Deloitte.
The survey, which featured respondents from eight European countries including the UK, France and Germany, involved over 2,800 people within the Gen Y age bracket.
Joe Vitale, Deloitte global automotive sector leader, said: "The results of this latest study show that the love affair Europeans have long had with their cars may be fading with this young, tech-savvy generation that can connect with friends and family wherever and whenever they want."
Costs appear to be the main factor holding potential young purchasers back. The top reasons why Gen Y consumers said they wouldn’t buy a car were operational and maintenance costs (72%) and affordability (71%). The third most popular reason was that their lifestyle was met by walking and public transport, selected by 67%.
Reflecting this last point, 42% of Gen Y said they would be willing to relocate closer to work to reduce their commute, compared to just 24% of other generations.
Despite this, 57% still said cars were their preferred mode of transport independent of cost, environmental impact, and convenience, and an overwhelming 81% had an interest in vehicles on the road today.
The younger generation was also far more likely to use technology to reduce costs and offer convenience. For example, 45% of Gen Y said they liked using a smartphone app to plan transport, compared to 27% of other generations, while 35% said they would try a ride-sharing app if recommended by friends or family, compared to 24% of other generations.
At the same time 36% of Gen Y said they worry about safety, security and privacy when ride sharing.
Alternatively fuelled vehicles
Looking to the future, less than half (44%) of Europeans said they would prefer to be driving an alternatively fuelled car in five years’ time, compared to 29% who said petrol and 27% who said diesel.
Of the alternatively fuelled vehicles, non-plug in hybrid electrics and plug in hybrid electric cars were the most popular options, selected by 14% each.
Although there was no difference between the generations on what type of car they would rather be driving in five years’ time, Gen Y was much more likely to be willing to pay more for alternatively fuelled vehicles. In total 71% of the younger generation said they would be willing to pay more for alternatively fuelled vehicles, compared to 58% of older generations. This gap closes when asked if they would be willing to pay $2000 more, to 39% and 30% respectively.
In addition, Deloitte said "About half of the consumers in Europe feel that there are not enough alternative powertrain options in the market, with around two-thirds preferring a broad range of powertrain options in each vehicle model."
Choosing a car
When it came to choosing a car, Deloitte found young people were more likely to thoroughly research there next vehicle. Just 20% of Gen Y said they consider one or two brands when buying or leasing a car, compared to 28% of older generations.
However young people also appeared more readily influenced. 59% said family and friends were a significant influence on their purchasing decision, compared to 41% of older generations, while 49% said they were influenced by reviews on websites, compared to 35% of older generations.
The next biggest gap between Gen Y and the rest was in the influence of social networks, where 20% of Gen Y said it influenced them, compared to 10% of older generations.
On a worrying note, only approximately a third of respondents said they had a positive image of car dealers and less than half said they were treated with respect and fairness by car sales men.
As a result, 39% of Gen Y said they would rather buy a vehicle without negotiating with a salesperson.