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Young Drivers Prefer Small Cars

A recent study from research firm GFK Automotive found that Americans who are intending to buy a car in the next year are considering small cars in bigger numbers than ever before.

According to the survey, Generations X and Y make up the majority of people considering a new car in the near future. A total of 63 percent of these Generation X and Y drivers are thinking about buying a new car, which is an increase of 8 percent over last year.

The age range of prospective car buyers in the near future runs from 23 to 47 years old. When it comes to small cars, members of Generation Y were the most likely to buy one. Gen Y consumers, which are made up of people born between 1980 and 1989, were much more likely than any other age groups to purchase a small car. A total of 29 percent were considering buying one in the next 12 months.

Surprisingly, the next generation that is seriously considering a small car is the pre-baby boomers, which is made up of drivers born prior to 1946. Roughly 20 percent of this group is seriously interested in a small car.

What Gen Y’s Are Looking for in a Car

Part of the study asked consumers from every age group to rank over a dozen vehicle attributes which were important to them when considering a new car. According to the study Generation X and Y have widely different tastes when it comes to cars than baby boomers and pre-baby boomers.

As an example, Gen Y and Gen Xers are much more concerned with how “exciting a car is” with Gen Y making it the 7th most important priority. It ranked 21st with older age groups. Gen X and Y were also very concerned with “technologically advanced features”, with both generations ranking it as the 12th most important features while old school drivers ranked technology 22nd.

So what exactly are older drivers looking for in a new car? Comfort, handling and the ride ranked near the top of the Baby Boomers list but drops all the way down to 17th with Gen Y drivers.

While the various generations differed on many factors they also found some common ground. Excellent gas mileage was a big priority across all groups. Dependability was also a winner, coming as the top concern for Gen Y and all of the older groups but dropping to second place for Gen X drivers.

Gen Y drivers are very excited about electric vehicles. According to a recent Deloitte survey, a whopping 59 percent of Gen Y car buyers claimed they preferred an electrified vehicle. The definition of “electrified vehicle” included hybrid vehicles so while Gen Y drivers want a battery component they are not demanding a strictly electric car.

Experts claim this could be a game changer in the world of hybrid vehicles. Gen Y is currently one of the biggest segments of the car buying community and their preference for hybrids may finally move these vehicles into the mainstream.

Insurance and Small Cars

While driving a small car can be cost effective and help the environment, it may increase your insurance costs. According to the Highway Loss Data Institute (HLDI), small cars showed a higher rate of insurance claims in which occupants were injured. The Toyota Yaris registered the highest frequency when it comes to insurance claims. Out of 10 cars with the highest PIP claims, seven of them were small or mini cars.

As with any new car purchase it is a good idea to shop your insurance around before committing to a specific vehicle. Call your insurance agent for a quote on any vehicles you are considering which will help you come up with a total cost of ownership for your new car.