Some hand wringing by the auto industry about the lack of demand among young people for their product gets me thinking.
Is it possible that we have taught these young people math too well so they can now calculate their own numbers about the cost of owning a new car? Since over 70% of them live in urban areas, have they figured out that it is much less expensive to live close to work, use public transit, taxis, or rental cars?
As a rural resident, a vehicle in an essential for me, but I would never consider buying a new one. Instead, I let others pay for the high cost of insurance and depreciation during the first few years of a vehicle’s life and then drive it until it drops.
I guess I am somewhat comparable to the young people referred to in this article. I refuse to part with my money for some silly marketing message.
If the auto industry wants to deal with this challenge, what they have to do is look to new information technologies to reduce the total cost of operating a vehicle. They need to think like packages software companies that are confronted by the cloud based services that sell the same utility on a fee-per-user or user basis.
Perhaps more importantly, they have to realize that the essential product they are selling is safe, reliable and comfortable transportation services instead of blocks of metal and plastic.