You’ve heard plenty of stories about young Australians without drivers licenses. A simple enough narrative it seems.
Young people live in inner cities and use public transport and bicycles to get around.
Plus, these modes of transport are so much more environmentally friendly than taking an evil gas-guzzling car. Perfect for a generation with a conscience.
As these people grow older, cars will become a thing of the past, right?
Well, let’s look at some data to see if the story of Australians turning their backs on cars is holding up. While we are at it, let’s also predict the future of the Australian car market in the coming decade.
As is normal, we will use Census data for our detective work.
We are not so much interested in people with or without a driver license.
Rather we want to know if people have ready access to a car. If one partner doesn’t have a license, the household can still live a car dependent life.
Also, the Census only tells us the number of cars (motor vehicles technically) that each household has. We will compare 2006 and 2021 Census data – that’s roughly one generation apart.
Turns out in 2021 there are 47,000 more people aged 25-40 that live in a household without a single motor vehicle.
Case closed; Australians shunned the car … Not at all
In 2006, Australia was home to 20.1 million people, of whom 1.18 million lived in households without cars.
By 2021 the nation added 5.4 million people (25.5 million) but the number of people in car free households declined by 86,000 to 1.09 million.
We are more likely to be car owners now than we were 15 years ago.
Our social conscience might have changed, and cars are vilified more now (electric cars are allowed to be enjoyed, though).
We might even feel guilty using our cars, but we are using them nonetheless.
But what about these additional 47,000 people aged 25-40 that turned their backs on cars? We saw strong population growth in that age group thanks to the Millennials (born 1982-1999).
The tiny increase in the total number of 25 to 40-year-old car free householders still translates into a relative decline of car free householders.
What will the future of the car market look like in Australia?
Based simply on demographics, I am predicting a big fat boom in car sales. Let me explain why.
If you want to play along at home have a look at the next chart first before you read on. It might not be the most intuitive chart to read but it clearly shows the upcoming boom.
At age 18 many folks have a licence and have places to go and either live in the parental home or they just moved out.
That’s why 18-year-olds don’t live in one car households.
If they live at home the household is pretty likely to have several cars, if they live in a raucous share house they are likely to live in a car free household.
Somewhere between age 19 and their early 30s Australians buy their first car or at least partner up with a car owner.
This sees the number of one car householders go up. Once the 30s hit, people begin making babies.
This means they move to family suburbs, likely on the urban fringe.
These are very much car dependent neighbourhoods. At least one partner goes to work, the other needs a car too to drive the kids around and run errands.
Welcome to the age of multiple cars in the household
This stage only peaks at age 54 when the kids have moved out and couples decide that one car will be enough.
Throughout their 60s and 70s Aussies are fine with a single car per household. Once in their 80s plenty of people forgo cars altogether.
So, what does the next decade hold for the car market then?
The huge Millennial generation continues to have kids, continues to swap the inner suburbs for car dependent family settlements on the urban fringe.
Car free Millennials will buy their first cars. They will want their first car to be large enough to fit prams, shopping, and sport equipment for the kids.
Millennials won’t completely leave their environmental conscience behind. Hybrids, electric vehicles, or at least fuel-efficient cars should be popular with these buyers.
Millennials alone will ensure that car sales will boom.
It will only be well into the 2030s when Baby Boomers give up on driving en masse.
If you run a car dealership, if you offer car loans, if you service cars the next decade will be great for you.
