So, can millennials be part of this? Are they ready to be part of the collectors club? And is the classic car market ready for them at all?
The dynamics of the classic car market
The collector market is melting down right now. There’s been little or no movement in the value of classics in the past years. Even more frightening is the fact that some of the most highly priced collector models have decreased their value in half since last year. Most of the vintage car market consists of pure American models – familiar and stylish vehicles that the population has grown up with. Yet, the demand for them is surprisingly low. The Hagerty index for collector car prices has fallen 15% since August 2015 when it had its peak and keeps on falling with an 8% year-to-year rate. Both auction activity and private sales are experiencing a decline.
Why is all this happening? Is it really because there is no more enthusiasm about classics in the country?
Turns out, it is a problem of ownership and continuation. According to a Hagerty report, baby boomers own nearly 60% of the collector classics in the US. What was good for the market a couple of years ago when boomers were spending their money on classic cars, today is an issue.
What will happen now when boomers are getting closer retirement age? They are starting to look at a more practical approach to life, eliminating all that they can’t take care of. Their interest in the hobby will soon start to decrease. So the big question is who is going to buy their classics? Especially when their children are not interested in owning a car at all.
What is it with millennials and cars?
Millennials’ driving habits became a concern for government officials and automobile companies several years ago. During the past decade, there has been tons of data showing that their interest in cars is disturbingly low. There have been reports that show young people drive fewer miles than their parents did. Not only that but they even show that teenagers no longer rush to get a driver’s license – something that was a milestone in the lives of their parents. They don’t consider the ownership of a car as a status symbol or a sign of freedom either.
Truth be told, this behavior is quite normal when it gets to the change in lifestyle and values that millennials experience. An increasing number of millennials prefer to live in city centers rather than in suburban areas. They are more outgoing and chatty. They like walkable distances and love being outside or spending time in nature. Gen Y would rather travel by public transport or share a ride than contribute to emissions harming the environment.
Officials and businesses have been wondering: how could millennials’ behavior change transportation habits of generations in the future? Will public transportation be more valuable for Americans than their own vehicles? Would there be any need for new cars at all?
Millennials do want cars after all
It turns out young people are not fully giving up driving just yet. Neither the high gas prices that prevailed in the last few years, not the new complicated licensing laws scare millennials. Because they are finally buying the cars the market had been pushing to them for the past decade.
Contrary to the original presumptions that millennials drive the “don’t own” economy, Gen Y’s behavior is no different from their parents’ when it comes to big life purchases. More than half of millennials already own a home and 88% of those who don’t, want to buy one in the near future. The sharing economy cannot change the meaning of traditional purchases. A 2017 Accel + Qualtrics Millennial Study found that 80 percent of millennials own cars and 75 percent of millennials who don’t, aspire to purchase one now.
Moreover, millennials spend more on auto loans than their parents did. A study by TransUnion found that consumers, ages 21 through 34, are taking out new auto loans at a 21 percent higher rate than Gen X borrowers did when they were the same age. Today, the interest rates are even higher, but there is more flexibility on payment options. This makes it more convenient for millennials to purchase a car, and it takes away the burden often associated with such big purchases.
While it was considered that technology will make millennials move away from cars, now it seems like it is helping expand their touchpoints to the vehicles market. It has fueled millennials’ car-purchasing habits to a point where they can even buy a car online. Online shopping tools are expanding the traditionally local marketplace in ways that make it more natural for millennials to embrace it.
The classics millennials want most
Earlier this year, Hagerty issued their latest Vehicle Report and it was related to millennials relation to the classics market. For this issue, Hagerty started following the buying habits of the younger collectors on the market more thoroughly. The company conducted a research among millennials and representatives of Generation X to see which are their favorite classics.
It is interesting to point out that, contrary to what one might expect, when it comes to classics millennials do not want Corvettes and muscle cars. Instead, they prefer… trucks. Two-thirds of the vehicles in the newest Top 25 ranking are trucks or SUVs, and nearly 90 percent of them are valued at $16,000 or less. The company’s insurance quoting data showed that it was exactly Millennials and Gen-Xers who are nearly 30% more likely to quote a truck or SUV than Boomers and Pre-boomers.
Pickups and jeeps are the vehicles that dominate the report’s top 10, too. Each of them scored between 89 and 96 points out of 100, which makes them the hottest collectibles on the market right now. There are assumptions that this is the result of the first SUV boom in the 90s. This was the time when millennials were growing up and their interest in cars was just starting to emerge.
When buying a classic young people focus first on comfort, and then on style. Some of the most wanted classics include the Ford F-series from 1973 to 1979, and the first C/K series Chevrolet introduced back in the 60s. We can say honestly that the Ford Bronco has an apparent dominance in the ranking – it occupies two positions with the 1966 and the 1978 series. There are only a few models among the first ten that reflect the new edge styling of the 1990s – one being the 1994-2004 Ford Mustang.
Can millennials be classic car owners?
Many like the idea of a classic car, but not everyone can face what vintage car ownership entails. Some of you might think millennials are too young to appreciate a classic. But are they really?
A true classic car owner is anyone who doesn’t own a vehicle simply for transportation, for its speed or the mere convenience of owning a car. Classics owners know how valuable, unique and timeless classic vehicles are. They own one not because of its financial value, but because of its beauty and its history. If you have seen Audrey Hepburn’s Breakfast at Tiffany’s or Roman Holiday, you would know what we mean. Even if you are not a huge fan of the Beetle. It’s the prestige of driving a classic that is too valuable. This is why the history of the car is so important to a classic’s owner – it is part of its soul – a part that has preserved and now the owner carries on to the future.
The magic about a classic – it is never just a car.
Maybe this is why millennials are getting more and more interested in classics. Because they remind them of the beauty of the past, of the simplicity of their childhood. When they were free and careless, when times were easy and yet so beautiful – all feelings that millennials lack but deeply need in today’s world.
These are the first years in millennials’ lives when they can really afford investing in something more expensive. Why a classic, and not an Audi Q7 you might ask? Where is the magic in going to the dealer’s and choosing from what’s available? Where is the hunt in browsing online and choosing the next Subaru or the next Dodge? Everyone can do that. But can everyone find the one-of-a-kind 1978 Chevi hidden somewhere in a rustic garage in a Georgia town? It involves knowledge, courage, and devotion to choose a classic. And not many people have the nerve to show these anymore
Getting a classic car for a millennial
Now that the obsession with all digital things is coming to a slow end, the car becomes a desired gift again. If you have a cousin or a nephew somewhere across the country who might enjoy the rusty classic sitting in your garage, there is a way you can easily get it to them.
Shipping a classic is not much different than shipping a regular vehicle. Except, it requires the care and attention the owner brings to its beauty on a daily basis. How would a classic’s owner leave their treasure with just anyone and “hope” they would ship it safely across the country.
At Corsia, we believe you need to have someone who shares your enthusiasm to transport your vehicle. If you need to send a vehicle over to the other end of the country, our representatives are eager to help. Request a shipping quote online or call (818) 850-5258 to meet the people that share your passion for classics. If you want information in advance, look at our guide for shipping a classic car.
Another way to get a classic is to import it. Even though this sounds scary at first, there is nothing impossible. You just have to follow the steps to importing a classic, so that you feel comfortable along the whole journey. When you are choosing where to import it from, keep in mind two things.
First, it is always best to choose a home region that is characterized by dry and warm climate. Countries bordering the Mediterranean are a perfect choice for this matter. Plus, millennials always see something romantic in Mediterranean countries, so that will add up to the value of the car.
Second, mind the economic situation of the region – sometimes you can be surprised by the low prices but that doesn’t necessarily mean this is a scam. Some countries, especially those in Eastern Europe, experience economic imbalances but they are also where the golden treasures hide.
The potential of the trend
The classic car market sees huge opportunities in the face of millennials. Experts say millennials can be the generation that will save the classics. While boomers are now coming of age, it is the generation of millennials that is coming close to their years of financial strength and appreciation of quality. According to Car and Driver Magazine, it is exactly when millennials hit their peak earning years in a few decades when the classics market will be thriving again. Hopefully, there won’t be many new Teslas to distract them from classics until then.