59% of Zillennials Value Leasing as Vehicle Purchase Option

Forget the open road and the roar of the engine. A new generation, the zillennials (those born between 1991 and 1999), are approaching transportation with a distinctly different mindset than their predecessors.

As detailed in PYMNTS Intelligence’s latest report, “Generation Zillennial: Zillennials’ Transportation Choices May Have Future Down Payments in Mind,” this cohort is less inclined to own vehicles outright, favoring flexibility and future financial goals over traditional car ownership. This shift has significant implications for the automotive industry and the broader mobility landscape.

The report highlights that zillennials are less likely than older consumers to own a motor vehicle as their primary means of transportation. Only 57% report owning a car for this purpose, a figure that climbs to 76% among baby boomers.

Instead, zillennials are embracing alternatives such as leasing, public transit and ridesharing services. In fact, 12% of zillennials use a leased vehicle as their main form of transport, a rate on par with Generation Z and millennials but higher than older generations. This preference for flexible options underscores a desire for on-demand availability, cited as highly important by 59% of zillennials.

Here are three key data points from the report that illustrate these trends:

• Less Ownership: Only 57% of zillennials use a motor vehicle they own as their primary transportation method. Implication: The traditional model of individual car ownership may be losing its grip on this influential consumer segment.
• Down Payment Focus: Fourteen percent of zillennials identify saving for a down payment as the biggest barrier to vehicle purchases, significantly more than the 9.5% of millennials who cite this. Implication: This suggests a strategic prioritization of future major purchases, potentially homes, over immediate car ownership.
• Flexibility First: On-demand availability is the most important factor for 59% of zillennials when choosing transportation, surpassing even environmental impact (37%) and second only to cost. Implication: Convenience and immediate access are key drivers for zillennial transportation choices.

Interestingly, this focus on financial prudence extends beyond transportation.

The report also reveals that zillennials are more likely than any other generation to cite the down payment as a barrier to home ownership. While high housing prices are a general concern, 24% of zillennials name the lack of down payment funds as their top obstacle.

Despite these financial hurdles, a significant 69% of non-homeowning zillennials still plan to purchase a home in the future, demonstrating a strong aspiration for homeownership. This forward-looking financial perspective appears to be shaping their current transportation decisions, suggesting that the choices zillennials make on the road today may very well be with future down payments in mind.

This analysis is based on a PYMNTS Intelligence survey of 2,779 U.S. consumers conducted in December.

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