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Gen X Makes Up the Largest Segment of New Vehicle Buyers

Published: July 1, 2021 by Guest Contributor

Smiling women driving a car

If we’ve learned anything from the past year and a half, it’s the need to adapt and pivot in real-time based on the current automotive market trends. One such trend that represents the need for flexibility is the unexpected change in new vehicle registrations by generation in the first quarter of Q1 2021. Namely, Gen X’s significant increase, and millennials’ decrease, in new vehicle registrations. This unexpected change is a reminder of the importance of remaining close to current data throughout the year to inform marketing strategies.

New Vehicle Registration Trends Reverse

Over the past several years, new vehicle registration trends by generation have remained relatively consistent. For example, baby boomers have seen a steady decrease in new registrations, while millennials and Gen Z have seen a steady increase. But Experian’s Q1 2021 Automotive Market Trends Review revealed that some of these once-consistent trends have reversed.

Gen X had one of the more surprising shifts, with new vehicle registrations increasing from 29.3% in Q1 2020 to 32% in Q1 2021. By comparison, Gen X had previously been steadily decreasing since 2018. As a result, Gen X now makes up the largest cohort of new vehicle buyers, pushing baby boomers from their top spot in 2020 (31.1%) down to 29.6% this year.

Likewise, the decrease in new registrations for millennials was equally as unexpected. Millennials have consistently made up a larger portion of new vehicle registrations over the past few years. But for the first time since 2017, millennials experienced a decrease in new registrations, from 27.8% in Q1 2020 to 27.3% in 2021. While the decrease may be small, it is an interesting and unexpected shift from the data we’ve seen over the last few years. Additionally, while millennials experienced a decrease, Gen Z continued to see an increase. Their generation grew from 4% in Q1 2020 to 5% in Q1 2021.

Generational data chart for new registrations

While we don’t know how these trends will continue to play out moving forward, dealers can stay one step ahead by understanding the generational trends in real-time, so they are prepared to market to them, no matter how the trends shift. This comes down to meeting each group where and how they like to be reached, an even trickier factor now that so much of everyday life has turned digital.

For example, according to Pew Research, around seven-in-ten Americans use social media. But the platforms can vary significantly depending on age. Pew Research found that Gen Z and younger millennials are more likely to use Instagram, Snapchat and TikTok, while Gen X is more likely to use Facebook and YouTube. Meanwhile, Statista found that 67% of millennials prefer online shopping, compared to 56% of Generation X and 41% of Baby Boomers. As consumers continue to leverage the many different digital opportunities for communicating and shopping, it will be important for OEMs and dealers to shift their marketing strategies to ensure they reach these consumers.

The automotive landscape is continually changing and fluctuating. As a result, we can’t be certain if these trends are a long-term or short-term change. As dealers and OEM’s look to fine tune their marketing strategies, staying close to these trends will allow them to be more informed, more strategic and tailor their marketing campaigns accordingly.

To watch the Experian Q1 2021 Automotive Market Trends Review, click here.

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While CUVs and SUVs continue to dominate the market, sedans remain a popular choice among consumers. According to Experian’s Automotive Consumer Trends Report: Q4 2024, sedans accounted for 18.4% of new retail registrations and 36.9% of used. Comparatively, CUVs/SUVs came in at 59.3% for new and 38.6% for used. For retail sedan registrations, the Toyota Camry made up the most market share for both new and used in the last 12 months, coming in at 10.5% and 6.0%, respectively. Meanwhile, the Honda Civic came in a close second for new sedan registrations at 10.1% and the Honda Accord followed closely for used at 5.9%. Knowing which sedan models are leading in registrations is important for professionals as it helps them understand evolving consumer preferences, enhance marketing strategies, and make informed inventory decisions. Understanding the key generations fueling the sedan segment When examining generational interest in this vehicle segment, data found Gen Z and Millennials over-indexed in new retail sedan registrations. In the past 12 months, Gen Z represented 12.4% of new retail sedan registrations, while their total new retail registration was 8.2%. Millennials had 27.3% of sedan registrations out of 27% total registrations. Understanding who is purchasing and what models they’re gravitating towards can unlock valuable insights as professionals craft their next move and position themselves one step ahead in a competitive market. To learn more about sedan insights, view the full Automotive Consumer Trends Report: Q4 2024 presentation.

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With the National Automobile Dealers Association (NADA) Show set to kickoff later this week, it seemed fitting to explore how the shifting dynamics of the used vehicle market might impact dealers and buyers over the coming year. Shedding light on some of the registration and finance trends, as well as purchasing behaviors, can help dealers and manufacturers stay ahead of the curve. And just like that, the Special Report: Automotive Consumer Trends Report was born. As I was sifting through the data, one of the trends that stood out to me was the neck-and-neck race between Millennials and Gen X for supremacy in the used vehicle market. Five years ago, in 2019, Millennials were responsible for 33.3% of used retail registrations, followed by Gen X (29.5%) and Baby Boomers (26.8%). Since then, Baby Boomers have gradually fallen off, and Gen X continues to close the already minuscule gap. Through October 2024, Millennials accounted for 31.6%, while Gen X accounted for 30.4%. But trends can turn on a dime if the last year offers any indication. Over the last rolling 12 months (October 2023-October 2024), Gen X (31.4%) accounted for the majority of used vehicle registrations compared to Millennials (30.9%). Of course, the data is still close, and what 2025 holds is anyone’s guess, but understanding even the smallest changes in market share and consumer purchasing behaviors can help dealers and manufacturers adapt and navigate the road ahead. Although there are similarities between Millennials and Gen X, there are drastic differences, including motivations and preferences. Dealers and manufacturers should engage them on a generational level. What are they buying? Some of the data might not come as a surprise but it’s a good reminder that consumers are in different phases of life, meaning priorities change. Over the last rolling 12 months, Millennials over-indexed on used vans, accounting for more than one-third of registrations. Meanwhile, Gen X over-indexed on used trucks, making up nearly one-third of registrations, and Gen Z over-indexed on cars (accounting for 17.1% of used car registrations compared to 14.6% of overall used vehicle registrations). This isn’t surprising. Many Millennials have young families and may need extra space and functionality, while Gen Xers might prefer the versatility of the pickup truck—the ability to use it for work and personal use. On the other hand, Gen Zers are still early in their careers and gravitate towards the affordability and efficiency of smaller cars. Interestingly, although used electric vehicles only make up a small portion of used retail registrations (less than 1%), Millennials made up nearly 40% over the last rolling 12 months, followed by Gen X (32.2%) and Baby Boomers (15.8%). The market at a bird’s eye view Pulling back a bit on the used vehicle landscape, over the last rolling 12 months, CUVs/SUVs (38.9%) and cars (36.6%) accounted for the majority of used retail registrations. And nearly nine-in-ten used registrations were non-luxury vehicles. What’s more, ICE vehicles made up 88.5% of used retail registrations over the same period, while alternative-fuel vehicles (not including BEVs) made up 10.7% and electric vehicles made up 0.8%. At the finance level, we’re seeing the market shift ever so slightly. Since the beginning of the pandemic, one of the constant narratives in the industry has been the rising cost of owning a vehicle, both new and used. And while the average loan amount for a used non-luxury vehicle has gone up over the past five years, we’re seeing a gradual decline since 2022. In 2019, the average loan amount was $22,636 and spiked $29,983 in 2022. In 2024, the average loan amount reached $28,895. Much of the decline in average loan amounts can be attributed to the resurgence of new vehicle inventory, which has resulted in lower used values. With new leasing climbing over the past several quarters, we may see more late-model used inventory hit the market in the next few years, which will most certainly impact used financing. The used market moving forward Relying on historical data and trends can help dealers and manufacturers prepare and navigate the road ahead. Used vehicles will always fit the need for shoppers looking for their next vehicle; understanding some market trends will help ensure dealers and manufacturers can be at the forefront of helping those shoppers. For more information on the Special Report: Automotive Consumer Trends Report, visit Experian booth #627 at the NADA Show in New Orleans, January 23-26.

Published: January 21, 2025 by Kirsten Von Busch

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