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Millennials, It's Your Fault New Car Sales Are Sliding…Apparently

The sharp drop in new car sales throughout 2019 has had no shortage of publicity, particularly now that 18 consecutive months of declining figures have come through. Over that time we’ve heard from experts as to a variety of factors that have contributed to the rut.

From political uncertainty before this year’s election, to a tightening in lending regulations, a weakening economy led by subdued house prices, the effects of a drought, and believe it or not vehicle shipments contaminated by little bugs! Now you can add another ‘explanation’ to the list because millennials, it’s your fault new car sales are sliding…apparently.


The underlying trends

You see, the shifting trends among millennials are pointing to a change in views towards car ownership. Younger Australians are holding onto their first vehicle for a longer period of time, or otherwise putting their driver’s licence on the back burner. There is testimony from some industry insiders to suggest that millennials are less comfortable with the idea of a loan than previous generations given a tendency to spend more to stay up to date with the latest technology or to fuel travel and entertainment aspirations.

The prompts are largely coming about through the influence of technology, including the role it is playing on behavioural patterns. First and foremost, the rise of apps like Uber and Ola have reduced dependency on individual vehicle ownership, instead promoting the benefits of a flexible ride-sharing fleet. Online food and grocery services follow the same notion, where a few simple touches on a mobile phone are enough to avoid making that trip to the supermarket.

At the same time, we’re also seeing far greater levels of urban consolidation take place in our major cities. Given the significant rise in house prices since the end of the GFC, many millennials are forgoing the Australian dream to own a home. An increasingly popular choice of action is to rent in highly desirable locations, which typically translates to inner city living or convenient public transport links nearby – both reducing dependency on vehicle ownership.

Finally, vehicle subscription services and peer-to-peer car sharing are becoming more commonplace in this demographic segment as well. A variety of companies have latched onto this trend, allowing anyone to borrow a car from a friendly stranger in their neighbourhood. Who would have thought it would be possible all those years ago?


Is there more to it than meets the eye?

Notwithstanding the trends that are taking place, the conversation has really only started to emerge in recent months. Look a little further back however, and what you realise is that new car sales were coming off an all-time high. Quite frankly, a level that some would argue may well turn out to be a short-term peak, or an otherwise unsustainable level once evidence of a slowing economy emerged. These trends have been occurring for some time now, so should have been observed earlier on sales data.

Furthermore, many of these trends are being attributed to millennials, but they sure as heck aren’t the only ones nurturing such changes. Those who have been brought up through these technological and societal changes become an easy target to point the finger at for ‘leading the way’ so to speak, but if this was really at the heart of the matter, then a range of buying incentives should suffice among other demographics to offset this decline.

But the facts remain, we’re seeing high levels of population growth, the lowest interest rates on record, and vehicle prices as affordable as they’ve ever been before. If those initiatives aren’t getting other buyers into the market, to offset a supposed wane in interest among millennials, where does the fault really lie?


  1. John Aquilina says:

    If manufacturers actually built cars people wanted that may help sales.
    If cars were honestly engineered to provide a trouble-free life, that would help sales.
    If manufacturers built low maintenance EVs (without ANY scheduled service intervals) sold them direct to customers to avoid huge dealership service and sales mark ups, then people may return.

    October 25th, 2019 at 10:56 pm

  2. James says:

    All the factors you mention are probably contributing to a drop in new car sales.

    I have an 8-year-old Mazda3 and would normally have been looking to update. The reason I have not is because of the mooted changes in energy technology, and my being pro-renewable, as are many of us quietly these days. Plus the risk of owning a stranded asset when fossil fuels will surely soon be on the nose.

    So what would be the point of purchasing yet another petrol car? Yes I know there are hybrids and fully electrics out there already, but why would I blow 50K for the kudos of being an early adopter?

    I reckon quite a few other people are in the same boat. Biut publicity about this is scarce for the same reason that climate change is an unmentionable in this country.

    November 25th, 2019 at 2:50 pm

  3. Len says:

    The cost of servicing by major dealerships has become ludicrous. and in many cases verges on extortion. It seems that mileage has no relevance to servicing when driven less than a designated figure rather than months you have owned the vehicle! It is well beyond time when the new car industry is brought into line with servicing costs and kilometres driven.

    November 25th, 2019 at 2:55 pm

  4. Bruce Roberts says:

    I do agree with John (above) that the dealership model is desperately due for a rethink. I’m in the process of buying a car (through Private Fleet) only as I couldn’t wait any longer. I, like many others, are holding on the to their old ICE cars with a view to move straight into EV in a year or three. This article seems to have glossed over this as a contributing factor.

    November 25th, 2019 at 3:01 pm

  5. Ian Rowan says:

    So you say but show us a graph of declining sales. Forget the words and show the evidence.

    November 25th, 2019 at 3:37 pm

  6. Garry Mitchell says:

    Could not agree more. Producing cars that people want instead of cars manufacturers wish to sell has always been a problem. The demad for small affordable electric vehicles is palatible yet no manufacturer is interested in particularly when the emphasis is on affordable. Our society is all about making money not trying to do the right thing for people or the planet and dont get me started on car reycling or recycling in general.

    November 25th, 2019 at 3:44 pm

  7. PETER ALLEN says:

    The trend is evident with the millennial, I see it first hand driving Uber, but I think some of the major issues to them are: Very little permanent work, some with several casual jobs to survive, the ever cycling price of fuel – how can people budget, and the ever increasing dependancy of technology and entertaiment. Certainty has been taken out of this world by those that run it.

    November 25th, 2019 at 3:45 pm

  8. David Thompson says:

    I have been waiting for 2 years for a car that performs as well as the one I have had for 6 years and avoids dual clutch and CVT transmissions. Likely new models are delayed until the new year.

    November 25th, 2019 at 3:49 pm

  9. Leon says:

    Also people are waiting for electric cars or less carbon producing. In a short while electric cars seem to have become a possibility

    November 25th, 2019 at 3:51 pm

  10. norbert KRAFT says:

    Speaking personally, it seems that a major factor is the improved quality, reliability and safety of modern cars. My family runs two vehicles that perform as well as new after 20 and more years of use. Why buy new when old reliable bertha is doing in really well ? One can also get very cheap upmarket used cars with 80% of their lives ahead of them for a fraction of their original cost. Also, the new tech is not for all; I much prefer what I’m used too and actually find it works just as well as the new tech – often better in fact.

    November 25th, 2019 at 4:06 pm

  11. Bob Hurst says:

    Surely the increase in luxury car tax must be affecting the imported luxury car end of the market !

    November 25th, 2019 at 4:16 pm

  12. Bob Hurst says:

    Surely the increase in luxury car tax must be affecting that end of the market in a big way.

    November 25th, 2019 at 4:20 pm

  13. Harry says:

    I realy do not Like Dealerships, I always feel Like they are there to Rip People off, To make Commissions, I only know one other Group that are as Dishonest, And that is Politicians. May be I am wrong, But that’s the way I feel.

    November 25th, 2019 at 6:19 pm

  14. Bill Nixon says:

    I have noticed millenials as a cohort, tend to show low interest in driving or owning motor cars. Not sure why, but this could explain lower vehicle sales. when I was their age everyone wanted to get their driver license and a car as soon as possible. Many, (me included) spent a large amount of their modest income buying and running these expensive machines. Perhaps kids have been brought up differently and are now so addicted to their iPads and smart phones that cars are no longer a priority. This bodes good for those of us who still drive, here will be less vehicles on the road. My plea, millenials, please stay home and play with your computers. Leave the road to your elders. We paid for them.

    November 25th, 2019 at 9:00 pm

  15. Lindsay Creighton says:

    As an older person, when Australian manufacturing stopped and all cars were brought in from other countries and especially asia. These cars rose in price and costs are now exorbitant which is just a case of dealers stuffing cash into their pockets and no caring about customers needs.
    i will not by an SUV or 4 WD because i have no use for them i am unable to happily trade my FG Falcon xr6 turbo as there is nothing that could replace it.
    looks like i will keep my Ford. Mustang is only 2 seater at best and as a new car far to expensive,

    November 25th, 2019 at 9:23 pm

  16. Wal Pywell says:

    Cars are becoming more reliable, but I believe that over the last few years, we are seeing little significant change in the cars themselves. So unless your car has done large mileage, there is little incentive to change it. No added functionality..
    My 2015 Skoda has all the bells and whistles needed with satnav, radar cruise control, autonomous braking auto parking, and almost anything else you can think of. And with around 35000km, what incentive do I have to change?

    November 26th, 2019 at 8:50 am

  17. Breitie says:

    What is surely helping declining car sales is the almost insane obsession with dual cab so-called utes.
    From what I see around me and on the streets, they are multiplying in plague proportions.
    They are akin to backsides because almost everyone has one.
    In my street alone, ten people, yes TEN, that I can see, have swapped their SUV’s, medium and large, as well as sensible economical commuter vehicles, for a double cab ute.
    Why? I cannot understand it because those things are quite impractical and neither fish nor fowl. They have a small, almost useless load platform, with no security, and the rear seats in the cabin are seriously compromised. I always have a laugh when I see one of those utes towing a trailer with a bed or a dirt bike or a wardrobe on it. Why have the ute in the first place then if it is literally useless (utelss would be a better description.)?

    November 26th, 2019 at 11:41 am

  18. Michael Kohler says:

    We’ve found it a great time to buy, having just hit the reset button on both our cars after 10yrs. Admittedly, we bought immaculate low km second hand and saved a third to half on new car prices. Hopefully they’ll do us another 10yrs.

    November 26th, 2019 at 2:58 pm

  19. Belinda-Lee Fay says:

    Manufacturers need to factor in servicing costs and parts costs and then manufacturers pass this on to customers. Build good quality and offer fixed price servicing for a 6 year period may help car ownership. It is huge outlay to buy at first then expensive servicing costs afterwards not to mention the huge costs of fuelling a car. When will electric cars come and will they be any cheaper to run? Watch that space!!!

    November 27th, 2019 at 7:34 am

  20. Steve B says:

    New cars continue to go up in price despite a compeditive market place. Running costs also keep increasing to the point where you have to decide if it is worth having a car at all. Electric vehicles will be the future but they have to be compeditive in price. Unfortunately the government is already considering a tax per kilometer on these cars. There is not much incentive to buy a new car, petrol or electric at the moment.

    November 29th, 2019 at 1:15 pm

  21. John Caldwell says:

    I agree with many comments. Current cars. 2015 Skoda Octavia Scout AWD turbo diesel. Average fuel use less than 5 litres/100 klm (as low as 4.2). Die for replacement next year. Will keep this another 3 yrs due to lack of affordable (under $40k)replacement of similar. SUV’s typically 20% dearer and 20% more on fuel and running cost. Other vehicle FGX Falcon ute. There is no ute on the market like this with low 2550 mm long tray, an d room behind seats for storage and lay seat back. Will now keep thiis basically forever

    December 1st, 2019 at 10:52 am