Tuesday, June 18, 2024
BusinessUS auto market will remain volatile in 2022

US auto market will remain volatile in 2022

Car-ownership app Jerry released its 2022 State of the American Driver Report, a comprehensive look at car-related trends, the adoption of new automotive technology, and current driving culture.

Due to inflation and an ongoing pandemic, the car buying and selling market will remain volatile in 2022. Business travel is making a slow return and commutes are returning to pre-pandemic norms. Outside the gas-powered vehicle category, electric vehicle (EV) interest continues to lag, and those considering buying EVs are motivated by savings over climate change. Americans are divided on the potential of autonomous vehicles.

The report analyzed results from a national survey of American drivers ages 16-75, combined with proprietary Jerry business data from more than 1.5 million U.S.-based drivers, and found that there is no evidence of a decline in car demand or the cost of driving. The survey found 80% of American drivers consider a car essential to conducting daily or weekly activities. Yet, drivers are limiting their time on the road, with 63% of consumers surveyed saying rising gas costs impacted how much they drove in 2021.

Key report findings include:

  • More Americans expect to sell cars in 2022 than in 2021, and digital platforms (Autotrader, Facebook Marketplace, Craigslist, etc.) are the most common way to sell. Baby Boomers still opt for dealer trade-in, and women are 3x as likely to sell on Facebook Marketplace. Top reasons for selling in 2021 were moving to an urban area, no longer commuting and rising gas prices.
  • One in four American drivers are planning to car shop in 2022, pointing to more potential supply- and demand-based tension in the automotive market. Another third will shop if prices go down. In a stark contrast to common beliefs, once at the car dealership, women are slightly more likely to believe they will be treated fairly than men.
  • Half of respondents chose to drive instead of fly in 2021, and nearly half (44%) of those intend to return to air travel in 2022. While business travel makes a slow return, in part due to virtual meetings, the majority of Americans expect to return to pre-pandemic daily commuting norms. The cost of commuting has increased for some who cited rising gas prices as the reason for the increase.
  • While ride-hailing feels ubiquitous to many, 50% of Americans have never used a ride-hailing app (Uber, Lyft, etc.), with age and region a major differentiating factor. 72% of Baby Boomers have never ride-hailed compared to 36% of Gen Z. Midwesterners are most likely to never have used a ride-hailing app.
  • A third of Americans surveyed never expect to drive an EV in their lifetime while half expect to within 10 years. However, they aren’t doing it to slow climate change. EV shoppers are motivated most by saving money on gas. Millennials are most eager to go electric, followed by Gen Z — who want EVs because they are “cool” more than any other reason.
  • Americans are split about the potential of autonomous vehicles in their daily lives, with 40% of drivers never expecting to use an autonomous vehicle. Gen Z drivers were most likely to say they expect to use a fully-autonomous vehicle within five years while all other respondents were most likely to say they never expect to use one.

“Our report confirmed that pandemic-era effects on cost and inventory continue to impact car buying and selling, driving frequency, and the necessity of driving among Americans,” said Jerry data scientist Lakshmi Iyengar. “Americans experienced sticker shock when shopping for new and used cars in 2021, and no relief is in sight this year. This raises the total cost of car ownership and creates the need to cut costs elsewhere. Despite significant EV interest due to expected cost savings, consumers likely won’t find immediate cost reductions when buying an EV. That may come over the next 10 years as technology and charging infrastructure mature.”

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