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Rising Costs And Test Delays Make Car Ownership Harder For Young People
Despite industry concerns, owning a car remains crucial for most 17-24-year-olds, with 90% valuing car ownership. Over two-thirds plan to use their cars as much or more than last year. Young people face barriers like rising used car costs, driving test backlogs, and increased insurance premiums. The industry can ease these challenges by making the car buying process more transparent and convenient.
Auto Trader's latest consumer analysis reveals that car ownership is increasingly important to young people aged 17-24. However, significant barriers such as driving test backlogs and rising motoring costs hinder their ability to own cars. This highlights the need for a more transparent and connected car buying experience to help young drivers get their first cars.
The study surveyed over 2,000 young individuals, finding that 90% consider car ownership essential. They cited the need to 'get around' (70%) and the independence it provides (67%) as primary reasons. Additionally, over half (54%) want a car for the sheer enjoyment of driving. The UK's unreliable public transport network also plays a role, with 50% citing it as a major reason for needing a car.
Young people are facing growing challenges in getting behind the wheel. According to DVLA forecasts, the backlog for driving tests is expected to grow, with a gap of over 1,100,000 tests by the end of 2025. Even after passing their tests, many young drivers find themselves priced out of the market due to a shortage of affordable cars and rising insurance costs.
Auto Trader data shows that while most young buyers paid less than £11,000 for their cars, stock in this price range has dropped by almost half since January 2016. Stock levels for cars under £5,000 have decreased by three-quarters during the same period. Rising insurance premiums further exacerbate affordability issues, with 18-year-olds seeing an 84% increase in premiums over the last year.
Despite these obstacles, demand among young people remains strong. Nearly four times as many young people (43%) report using their cars more today than they did a year ago compared to older drivers (12%). This indicates that the desire for car ownership is not waning among this age group.
Opportunities for Industry Improvement
The industry has an opportunity to assist young buyers by removing traditional obstacles that disproportionately affect them. Improving transparency around finance options is crucial. Auto Trader research found that over a third of younger consumers who bought with cash did so because they were unaware of available finance options. Nearly two in five didn't understand these options.
Younger drivers also prefer completing more of the car buying journey digitally. Over half (53%) have checked if a car advertised online is available compared to just one-fifth of older drivers. Additionally, 42% want to complete tasks like paying deposits online versus 26% of older drivers.
Marc Palmer from Auto Trader commented: "There’s been some recent suggestion that young people aren’t interested in having their own car anymore, but that simply isn’t the case. The desire for independence and freedom that a car offers is as strong as ever among young people today."
The automotive industry must respond to these challenges by making the car buying process more transparent and convenient for young people. Addressing these barriers will help an important and growing audience enter the market and achieve their goal of owning a car.
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