Consumer views on the necessity of vehicle ownership are slowly changing, according to a 2018 Cox Automotive Evolution of Mobility Study on Alternative Ownership.
Nearly 40 per cent of respondents — four per cent more than in 2015 — agree that having access to mobility is necessary, but owning a car is not.
When it comes to urban consumers, the report reveals that 57 per cent of respondents indicated that access to mobility trumps vehicle ownership in importance, which represents a 13-point increase from 2015 study results. Many, nearly 50 per cent, also perceive the cost of ownership and leasing a vehicle to be too high.
“Private ownership still dominates the automotive landscape, but options like ride-hailing and subscription programs are increasingly popular with young urban dwellers,” said Michelle Krebs, executive analyst for Autotrader. “The trendline for these programs could drastically alter this industry over the next five to 10 years.”
Based on the study, the majority of today’s consumers still enjoy the freedom and convenience of owning a vehicle as their main mode of transportation. But the feeling is not mutual for 55 per cent of Generation Z consumers (respondents aged 12-22) and 45 per cent of Millennials (respondents aged 23-36).
Instead, business models such as ride-hailing, car-sharing and new subscription or flexible lease options are gaining traction among these groups. Carmakers like BMW, Mercedes-Benz, Porsche and Volvo have acknowledged this trend and, like many mobility companies, are beginning to offer these services.
“Car subscriptions are gaining traction among Millennials, and it’s anyone’s game at this point,” said Joe George, Cox Automotive Mobility Solutions Group president. “Our clients are already shifting some of their focus to mobility with automakers and dealerships getting into subscriptions, as well as car-sharing and fleet management. Our strategy is to enable our clients to grow their business and stay relevant as the automotive industry evolves.”
