Automakers focusing on younger buyers

Gm / Wieck

Chevrolet is testing the interest of Millennial buyers in a pair of concepts, including the Tru 140S.

By Paul A. Eisenstein, The Detroit Bureau

There?s a big gap between what people say they want and what they?ll actually spend their money on, as automakers are well aware of.?So, the industry is taking a cautious view of a new study by consulting firm Deloitte that finds six of 10 Millennials would like to buy a hybrid or electric vehicles rather than a conventionally powered car, truck or crossover.

That would suggest that manufacturers are positioning themselves well for the wave of young buyers just now entering the market ? also known as Gen-Y, the Millennials comprise a cohort of almost 80 million Americans, a group even bigger than the vaunted Baby Boomers that reshaped America over the last half century or so. Virtually every maker on the market is now offering at least one gas-electric model in its line-up, with an assortment of conventional hybrids, plug-ins and pure battery-electric vehicles, or BEVs, to follow.

But young drivers aren?t the only ones who say they want to go with the latest, battery-based green technologies. Some other recent surveys have found that even older Americans routinely say they plan to ?consider? a hybrid next time they shop for a new car.?It?s just that those battery-based vehicles usually don?t make the cut, in the end. Last year, hybrids actually slipped as a percentage of the overall U.S. market to barely 2%.?Total sales of all battery-based vehicles barely matched demand for the Honda Accord.

Nonetheless, the new Deloitte survey echoes the results of other studies that have found Millennials to be more environmentally conscious than any other age group now in the automotive market.

?Gen Y is familiar and comfortable with hybrid technology,? said Craig Giffi, Deloitte?s vice chairman and head of its auto practice, suggesting that the Millennials will ?lead us away from traditional, gasoline-powered vehicles.?

The study looked at the automotive buying preferences of 1,500 consumers from the Gen Y, X and Baby Boom generations ? 250 of those surveyed being between the ages of 19 and 31. The group included consumers in China as well as Europe.

Significantly, while the Millennials were clearly comfortable with hybrids, as Giffi noted, they were less so with pure BEVs, only 2% saying they?d consider a vehicle running on battery power alone.

Stan Honda / AFP - Getty Images

Upscale sedans, electric vehicles and old-school muscle cars make their debuts at the 2012 North American International Auto show.

The auto industry is making a big push to understand what Millennials are all about ? and trying to differentiate between outward social and political stands and what they?re actually willing to spend their money on.

?It?s a big challenge,? said Clay Dean, head of advanced research for General Motors, but one that could pay off big in the long-term. As GM discovered when it lost much of the Baby Boom generation, it?s essential to get buyers into a brand?s products when they?re still young. Once they become loyal to the competition it?s difficult to those buyers them back.

Chevrolet unveiled two possible additions to its line-up, dubbed Code 130R and Tru 140S, during the 2012 Detroit Auto Show. One or the other could be put into production ?quickly,? according to Dean, if they generate much enthusiasm. The Code 130R is a sort of Baby Camaro, the 140S more of what he described as a ?poseur? sports coupe, one that could readily be outfitted with a hybrid drivetrain if GM found the demand there.

But the new Deloitte study makes it clear that green technology isn?t the only thing needed to make the Millennials happy. About just as many of those surveyed ? 59% ? said that in-dash technology is a critical differentiator. Of those, 75% said they wanted a touch-screen interface, with 72% wanting access to their smartphone apps.

The survey also showed they expect such high-tech safety features as advance collision warning and blind-spot detection.

Considering the budget most young buyers have at their disposal they might not be able to get everything they want, at least not immediately. So, manufacturers will have to read between the lines of the study to decide what they can afford to offer the Millennials now.

More from The Detroit Bureau:

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Picking Tomorrow?s Top Collector Cars

First 2013 Chevrolet Corvette 427 Convertible Set for Auction

Source: http://bottomline.msnbc.msn.com/_news/2012/01/23/10216471-automakers-focused-on-what-young-buyers-want

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