By Zach Bowman
Edmunds has taken a closer look at the buying habits of young adults. As it turns out, Gen X and Gen Y buyers are increasingly eschewing Japanese brands in favor of South Korean and American automakers. Five years ago, that wasn’t the case, with more than half of all young buyers flocking to brands like Nissan, Honda, Toyota, Subaru and Mazda. But the U.S. has made up quite a bit of ground in recent years by producing inexpensive and fuel efficient small cars that appeal to a younger audience. Likewise, Hyundai andKia have sharpened their small car games as well, and are now making more credit available to younger customers.
Those efforts have begun to pay dividends. While Japanese brands have seen their share of 18-24 year-old buyers slide by 9.8 percent between 2008 and 2012, domestic automakers have enjoyed a 1.9 percent increase. South Korean brands, meanwhile, have enjoyed the largest jump, with a 6.8 percent increase over the same time period. Check out the full press release below for more information.
Young Car Buyers Shift Preferences from Japanese to U.S. and Korean Brands, Reports Edmunds.com
SANTA MONICA, Calif. – March 20, 2013 – American auto brands are gaining strength with younger buyers in the U.S., while their Japanese rivals have taken a big step back, reports Edmunds.com, the premier resource for car shopping and automotive information. According to an analysis of new car retail registrations from R. L. Polk & Co., American brands accounted for 36.8 percent of cars bought by Americans age 25 to 34 in 2012, up from a share of 35.4 percent in 2008. Meanwhile the share of Japanese brands for the same age group plummeted from 50.6 percent to 42.9 percent during that period
But even with the incremental success of American brands, Edmunds.com found that the exodus from Japanese cars by young buyers is turning mostly toward South Korean brands. About 10 percent of new cars purchased by 25-to-34 year olds in 2012 carried South Korean nameplates, more than doubling the rate for this age group since 2008.
“U.S. automakers have burst onto the scene in recent years with small, fuel-efficient and affordable cars that really appeal to a young set of buyers,” says Edmunds.com Sr. Analyst Jessica Caldwell. “But while Detroit might be chiseling away at the Japanese grip on Gen X and Gen Y, South Korean brands are taking big hacks. Not only are the Koreans making better cars for young people, but they’ve also worked to make credit available to young buyers who still don’t have solid credit history.”
The South Koreans’ progress with young buyers reflects their overall growth in the U.S. market. Korean brands represented 9.5 percent of all new retail registrations in the U.S. in 2012, almost twice as much as their share of 5.0 percent in 2008.
European car labels are flexing their own muscles in the U.S. market as well, accounting for 9.9 percent of new car registrations in the U.S. last year, up from 8.5 percent in 2008. Like the South Koreans, European carmakers have delivered consistent growth among all age groups since 2008, with the biggest successes among older car buyers, thanks to Baby Boomers choosing European luxury cars post-retirement.
Edmunds.com offers a wealth of insights into car shopping behavior and habits through its Industry Center at http://www.edmunds.com/industry-center/.