US Marketing Auto to Gen Z and Millennials Consumer Report 2023

Overview

• What you need to know
• This Report looks at the following areas among Gen Z and Millennials
• Definition
• Market context

Executive Summary

• Top takeaways
• Consumer trends
• Millennials are the most interested in purchasing in the short term
  • Figure 1: Purchase timeline, by generation, 2022
• Millennials are influenced by more factors
  • Figure 2: Important factors, by generation, 2022
• Younger consumers learn about new vehicles from a variety of sources
  • Figure 3: Learning sources, by generation, 2022
• Brands with reputations of reliability, value are most considered
  • Figure 4: Brand consideration – Would consider, by generation, 2022
• Affordability is a primary concern among Gen Z consumers
  • Figure 5: Top concerns, by generation, 2022
• Millennials seek more as part of their investment
  • Figure 6: Next car features, by generation, 2022
• Competitive strategies
• Auto brands leverage heritage to drive interest in electric vehicle offerings
  • Figure 7: Chevy Silverado “A whole new truck for a whole new generation”
• Honda, Sony partner to develop Afeela
  • Figure 8: Sony showcases the Afeela on social media
• GM partners with Netflix for in-show placements
  • Figure 9: General Motors showcases partnership with Netflix
• Mercedes-Benz and TikTok drive in-car entertainment
  • Figure 10: Mercedes-Benz partners with TikTok for in-car entertainment
• Automakers look to reach consumers through their pets
  • Figure 11: Subaru highlights “dog tested, dog approved”
• GM and Activision partner to drive engagement among younger consumers
  • Figure 12: GMC highlights its “Call of Duty” integration
• Market predictions
  • Figure 13: Automotive industry outlook, 2023-28
• Opportunities
• Partner with financial institutions or apps to guide younger consumers by their budget
• Drive interest by offering month-to-month subscription programs
• Create experiences beyond the car to improve perceptions and consideration
• Continue to educate consumers on electric offerings
• Continue to promote sustainability efforts, beyond electrified models
• Partner, develop car sharing platforms

Market Drivers

• Gen Z, Millennial consumers grow to make up a larger portion of the population
  • Figure 14: Population, by generation, 2017-27
• Consumer confidence is increasing, but remains supressed – driving younger consumers’ consideration of budgets
  • Figure 15: Consumer Sentiment Index and unemployment, 2000-23
• Cost of new and used cars remains elevated, raising barriers for younger consumers
  • Figure 16: Consumer Price Index, new vehicles and used vehicles – Seasonally adjusted, 2018-23
• Gas prices present a potential to further affordability concerns among younger consumers
  • Figure 17: US gasoline and diesel retail prices, 2007-23

Competitive Strategies and Market Opportunities

• Leverage heritage to drive interest in electric vehicle offerings
  • Figure 18: Chevy Silverado “A whole new truck for a whole new generation”
• Honda partners with Sony to develop electric offerings
  • Figure 19: Sony showcases the Afeela on social media
• GM partners with Netflix for in-show placements
• The opportunity: leverage entertainment to reach interested consumer segments
  • Figure 20: General Motors showcases partnership with Netflix
• Mercedes-Benz and TikTok partner to bring in-car entertainment
• The opportunity: provide unique in-car entertainment for drivers, passengers to differentiate from competitors
  • Figure 21: Mercedes-Benz partners with TikTok for in-car entertainment
• Automakers highlight pet ownership
• The opportunity: highlight life with a pet to resonate with younger consumers
  • Figure 22: Subaru highlights “dog tested, dog approved”
• GM and Activision partner to drive engagement among younger consumers
• The opportunity: leverage video games to drive awareness among younger consumers
  • Figure 23: GMC highlights its “Call of Duty” integration

The Gen Z and Millennial Consumer – Fast Facts

Ownership and Purchase Timeline

• Most younger consumers have access to at least one vehicle
  • Figure 24: Household vehicle ownership, by generation, 2022
• Younger consumers own sedans, despite some automakers’ shift
  • Figure 25: Car type ownership, by generation, 2022
• Millennials are still the most active car buyers in the short and long term
  • Figure 26: Purchase time line, by generation, 2022
• • Figure 27: Vehicle type consideration, by generation, 2022
• Multicultural consumers indicate limited access, but strong interest in purchasing
  • Figure 28: Household vehicle ownership, by race and Hispanic origin, 2022
• • Figure 29: Purchase time line, by race and Hispanic origin, 2022

Important Factors

• Millennials lean on experience; Gen Z look for guidance
  • : Figure 30: Mercedes-Benz highlights a commitment to recycled materials
• • Figure 31: Important factors, by generation, 2022
• Female consumers are most driven by tangible factors
  • Figure 32: Ford launches “Built Ford Proud” campaign
  • Figure 33: Important factors, by gender, 2022
• Parents are influenced by multiple factors; indicate emphasis on safety
  • Figure 34: Important factors, by parental status, 2022

Sources of Learning

• Social media, friends and family are primary avenues of discovery
  • Figure 35: Nissan launches #HowdoyousayAryia campaign to spread awareness
  • Figure 36: Learning sources, by generation, 2022
• • Figure 37: Social platforms of discovery, by generation, 2022
• Female consumers lean on friends and family, experts
  • Figure 38: Learning sources, by gender, 2022
• Young multicultural consumers learn about new vehicles across multiple channels, new opportunities emerge
  • Figure 39: Audi presents: Janelle Monae & the Audi RS e-tron GT
  • Figure 40: GMC Hummer EV leverages Lebron James
• • Figure 41: General Motors advertises their partnership during the super bowl
  • Figure 42: Learning sources, by race and Hispanic origin, 2022

Brand Consideration

• Toyota, Honda lead across younger consumers
  • Figure 43: Brand consideration – Would consider, by generation, 2022
• Multicultural Gen Z and Millennials consider various brands
  • Figure 44: Nissan aims to empower black creatives
• • Figure 45: Toyota highlights the Corolla Cross, Hispanic creatives
  • Figure 46: Toyota highlights the Toyota Tundra, Hispanic creatives
• • Figure 47: Brand consideration – Would consider, by race and Hispanic origin, 2022
• Toyota, Honda stand out among younger LGBTQ+ consumers
  • Figure 48: Subaru highlights its dining out for life partnership
• • Figure 49: Hyundai highlights the LGBTQ+ community
  • Figure 50: Brand consideration – Would consider, by LGBTQ+ status, 2022

Concerns When Buying a Car

• Gen Z consumers keep affordability in mind
  • Figure 51: Hyundai features the lifetime of its vehicle
  • Figure 52: Nissan highlights comfortability, space for dogs
• • Figure 53: Top concerns when buying a car, by generation, 2022
• Female consumers are most concerned with their budgets
  • Figure 54: Top concerns, by gender, 2022
• Multicultural consumers concerned with value
  • Figure 55: Top concerns, by race and Hispanic origin, 2022

Next Car Features

• Millennials seek more
  • Figure 56: Next car features, by generation, 2022
• Women indicate an interest in safety
  • Figure 57: Mercedes-Benz highlights a commitment to equality though safety
  • Figure 58: Next car features, by gender, 2022
• Income drives an interest in certain features
  • Figure 59: Jeep highlights the Grand Wagoneer entertainment system
  • Figure 60: Next car features, by household income, 2022

Appendix – Data Sources and Abbreviations

• Data sources
• Consumer survey data
• Abbreviations and terms
• Abbreviations