Will Less Teens Driving Today = Fewer Expensive Car Purchases in the Future?

Now THIS is a car for a teenager

When I was a teenager, I couldn’t wait to drive. It seemed like most people I knew were like that. Driving meant freedom, independence, and taking a step closer to adulthood. Also, it meant more opportunities for meeting up with friends, having fun, and socializing.

A recent article I saw on Moneyland discussed how this level of excitement might not be at the same level these days. More specifically, the article referenced a study that indicated that fewer teenagers have driver’s licenses presently versus 25 years ago. Actually, the comparison was 2008 vs. 1983, but close enough, right? In 25 years, the percentage of 17 year olds with a driver’s license dropped from 69% to 50%.

What’s behind this? A hypothesis noted in the article revolves around the idea of teens having more opportunities to interact with one another, though online methods as well as texting. Additionally, the high cost of gas might play a role as well.

I think there’s something to that.  As I mentioned earlier, a big part of getting a driver’s license as a teenager had been the opportunity to socialize. Sure, getting to school and part-time jobs was helped by having a license.  But the social aspect of it was there too. Now, at least some socializing is able to done without driving. Plus, gas is currently expensive relative to historical prices and inflation, as we have discussed here before.

Thinking of implications in terms of spending money, it seems as though it might lessen the so-called need for teenagers to have a decent ride. The topic of cars for teenagers has been one that has elicited some strong opinions from those who think that many teens have oversized appetites for expensive cars.  Count me in that group!

Of course, in light of this data on decreased percentages of teenage drivers, maybe we’re seeing the beginning of a trend in terms of the types of cars they drive. I mean, if they aren’t clamoring for a car as much, why would it matter as much what car it is that they ultimately get?

Taking it a step further, I wonder if we’re looking at the beginning of a trend where the next generation of buyers might not be as interested in overspending on new cars? After all, today’s teenagers are tomorrow’s new car buyers. If they’re not as socialized into making a part of their self-identity shaped by the vehicle they drive, perhaps this will be less likely to happen as they get older.

That would be a good thing, provided there isn’t a corresponding shift toward overspending in other areas (technology, anyone?). As far as car purchases go, I personally think that cars are necessities for many adults, but are also usually financial liabilities. Instead of spending on a luxury car brand that’s expensive, why not take on a very modest car loan to buy a less expensive yet highly rated and reliable brand? You can save the difference, and put it toward retirement. Additionally, driving a car for many years is a good way to avoid additional expenses, provided you take care of it. I drove a car well past 200,000 miles and avoided big expenses in the process, so I know it can be done!

We’ll see where this trend takes us, and whether it’s a leading indicator to some type of change in overall perceptions of wants vs. needs with types of car purchases.

My Questions for You:

What do you think of this data on teenagers driving less?

Do you think teenagers only need functional and safe cars, if they have one at all?

Do you think this might be a harbinger of things to come, with less interest in expensive car purchases in the future?

Comments

  1. says

    Interesting data – but I wonder how much safer the road actually is… I figure that whenever you first get your permit/license you are probably the most dangerous. So, even if you’re 28 instead of 18… your inexperience is still a bad thing. We’ll have to let it play out.

    And yes, teenagers should be happy with something safe and functional. I mean, there are plenty of reasonable, moderately reliable used cars which are ‘good enough’ for the teen group.

    • Squirrelers says

      PKamp3 – True that there are some older drivers who drive less than teens and might not be as safe. That’s certainly possible. The key thing to me is whether or not we’ll see less expensive cars on the road in the future, since today’s teens don’t seem to be in a rush to drive – at least not quite like 25 years ago, according to the data!

  2. says

    I think another reason fewer teens are driving is because most schools don’t have driver’s education anymore and many states have graduated licensing schemes for teenagers. Also, it seems to me that teens today aren’t in as big a rush to be independent.

    • Squirrelers says

      Andy – interesting point, I hadn’t thought of school and drivers ed. As far as independence goes, I think we might be seeing a delay in that. Easier to stay home with parents, from a money perspective, than venture out to a world of being underemployed for some folks.

  3. says

    Interesting numbers there, I like that fact that these teenagers will become drivers a few years later as they would have picked up some maturity. This obviously will make our roads safer even if they are inexperienced as what counts is being less hot headed!

    • Squirrelers says

      BTI – theoretically they’ll be mature, we can hope, right? :) Of course, if they don’t drive much as teens but pick it up in their 20′s, they may be less experienced drivers then too. But as you point out, there’s something about maturity that goes beyond experience.

  4. says

    I think the internet is the main reason for the decrease. Kids just don’t have to get together to hang out anymore, like you mentioned.

    I think parenting might also play a role since parents seem a lot more overprotective today than they were back then.

    I don’t think the lack of desire to drive will play out into cheaper cars. When those kids do decide to buy a car I think they will still want something nice. I don’t think they don’t value a car, they just don’t have a need for one right now.

    • Squirrelers says

      Ashley – if it really is the internet as we’re suspecting, it goes to show how influental social networking really is in our society. There are subtle changes going on right before our eyes, in terms of things like this we might not have thought about!

  5. says

    Like PKamp3 said, if you’ve ever driven in a developing country with a bunch of new drivers, you know age has nothing to do with driving competence.

    I wonder if it is the protective parents too. If you have mom the taxi driver, do you need to be spending your money on a car when you could be buying apps on your iphone?

    • Squirrelers says

      First Gen – your 2nd paragraph gets me thinking, is it that some teens have better sense with money these days due to seeing economic issues, or is that they’re just shifting spending from cars to other things. Interesting….

  6. says

    It is interesting to me also that many teens are not driving as soon as possible. This was such a right of passage in my day and as early as possible the better. Time will tell if this is just a passing thing or if we will see a definite change in the lives of this generation. You comment on drivers in developing countries was dead on. Thanks for the post.

    • Squirrelers says

      Dr Dean – I know what you mean about it being a rite of passage at one time. It was when I was that age, and people couldn’t wait for the day they were eligible. Things change a bit over time with some customs, and this might be another example of that.

  7. says

    A good used reliable small car sounds good for our budding teenagers. In a down economy, perhaps some formerly-indulgent parents aren’t as ready to splurge on a sweet-sixteen Beamer.

    • Squirrelers says

      101C – hard to imagine why a parent would indulge a kid that age with an expensive car, but I’ve known people who have done things like that. I do think safety is important of course, and letting a kid drive a total pile of junk may involve other irresponsibilities. Agreed on the notion that car should at least be reliable.

  8. says

    My daughter is a teen driver but she didn’t get her license until she was almost 17 years old. There just wasn’t a strong desire to rush right out and get it. She also had to take a drivers education class and we had problems working it into her schedule at the time. The class was held on Saturdays for several weekends and we had to wait for her volleyball season to end so that she could attend the classes. She also has several friends who waited quite a while before getting their licenses. I definitely think that the ability to socialize in other ways has decreased the desire to get their drivers license as soon as they can.

    • Squirrelers says

      Pam – things sure have changed a bit, it would seem. I wonder if there are still a decent amount of kids that truly are super anxious to drive. I would think so, but it could be a case of me viewing things through a different lens

  9. says

    I think the statistic is interesting, but I am having trouble extrapolating on it. I didn’t read the Moneyland article but am going off of your takeaway.

    Does part of this decline have to do with the increased legislation surrounding obtaining licenses in some areas?

    I think the social aspect of driving is great but is secondary to the psychological aspect: freedom!!!!

    • Squirrelers says

      Roshawn – the assumption I made was actually surrounding the availability of social media options, but perhaps you’re on to something. As far as freedom goes, I do think that’s a huge part of it. Sure was for me, I took off for a several hour drive with a buddy within a week or two of getting my license.

  10. says

    I wonder if part of it is the high cost of insurance too, and fewer teens seeming to be employed. I don’t think my son would be driving if I weren’t paying his car insurance.

    • Squirrelers says

      Jackie – good points, and the employment aspect is an interesting angle. A part of prior driving, or at least parental help in some cases, was the excuse of having to go to some part time job. With less opportunities, maybe that plays a role?

  11. says

    My kid also got driver’s license at 17 after taking a drivers’ ed course. I think that environmental and price considerations are key. Mine says, why own and pay for a car and pollute the earth when public transit is perfectly adequate?

    • Squirrelers says

      anexactinglife – that’s actually interesting, about environmental concerns. Hadn’t thought too much about that, but it makes sense that today’s kids are more interested in the environment than the prior generation was.

  12. says

    I never would have thought that there would have been that much difference in the number of teenagers driving today. I suppose that gas prices and Facebook would play a major role as you suggest. I am working on my third teen getting a license right now and try to focus on safety. We got a Chevy Cobalt which I drove for a year to make it good and used and let the kids drive it after that. It has about 76,000 miles on it now, and we hope to be able to keep it running for a while longer.

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