Young drivers prioritise price and functionality over status symbols or brands, finds report
Car ownership has undergone a notable shift, according to a new report from OC&C Strategy Consultants. Despite steady demand for cars between 2020 and 2024, the factors influencing buyers’ decisions have evolved.
Consumers in the UK and the US are increasingly focused on practicality and cost, rather than the prestige associated with specific brands or models.
OC&C’s analysis reveals a marked departure from cars as status symbols. In the UK, only 31% of consumers viewed their vehicle as a status statement in 2024, down from 37% in 2021. The US saw an even steeper decline, with figures dropping from 54% in 2021 to 41% in 2024. These shifts are most pronounced among younger consumers. The report notes a 33% reduction in 24-year-olds and younger considering cars a status symbol between 2018 and 2022, compared to a 15% decline in the over-65 age group.
Economic concerns have driven these changing priorities. Rising inflation and the ongoing cost-of-living crisis have led consumers to reassess discretionary spending, and cars are no exception. In the UK and US, budget pressures have made drivers more aware of the functional benefits and financial commitments associated with vehicle ownership.
One emerging trend is the preference for monthly finance or leasing options rather than outright ownership. Consumers increasingly view a car’s affordability as a monthly expense, making leasing more appealing and pushing automotive finance models to the forefront.
However, despite these economic pressures, the all-in cost of motoring in the UK has decreased in real terms over the past decade. OC&C’s findings contradict popular perceptions, indicating that motoring remains relatively affordable compared to past years. Yet, even with this cost reduction, practicality and affordability remain dominant themes in car buying decisions.
China stands as a clear outlier. The country has seen a 3% rise in the number of consumers viewing cars as status symbols, moving from 36% in 2021 to 39% in 2024. This contrasts sharply with Western trends and highlights a unique cultural difference in car ownership motivations.
The landscape of car purchasing is changing, driven by younger generations and economic realities. As the focus shifts towards functionality and cost, traditional ideas of car ownership status are being parked firmly in the rearview mirror.
Felicity Latcham, Associate Partner at OC&C Strategy Consultants, said: “When consumers do buy, they think about budget first over the make or model, with around six in 10 agreeing that they start their search for a car with the budget in mind. This trend is the same in both the UK and the US.”
Felicity added: “The UK has experienced a 51% cumulative general inflation and a 47% increase in motoring costs since 2014, in line with average wages, which also rose by 47%.
“Insurance has increased markedly in real terms, but the cost of purchase and the cost of fuel have tracked far below inflation in the UK, meaning car ownership is one of the more affordable modes of transportation.
“The future of the automotive industry will rely heavily on manufacturers providing competitively priced models for the mass market. As younger generations drive this change away from status symbol models, and gain more purchasing power, we do not expect this trend to reverse.
“This pressure for ‘affordability’ will only be greater in driving the uptake of EVs, where consumer appetite is falling despite regulatory demands for sales ramping up. This is most clearly seen in consumer consideration of Chinese brands – despite a relative lack of ‘evidence’ of quality today, 22% of EV considerers would only need a £1000 discount or less to switch from their current brand. Suppliers and retailers can win by providing well priced options alongside attractive financing. or potential ‘full subscription’ packages for consumers.”
