Study Says Teens Aren't Anti-Car, They're Just Broke

Illustration for article titled Study Says Teens Arent Anti-Car, Theyre Just Broke
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1st Gear: It's The Economy Stupid
If you credit Jalopnik with anything, credit us with saying from the beginning that the lack of enthusiasm for cars amongst drivers had nothing to do with cell phones or Twitter or burgeoning environmentalism and everything to do with the economy. Thankfully, we're not alone and other journalists and groups have been pushing back against this notion.

Via Dub-Shep, here comes a study from the Insurance Institute for Highway Safety's Highway Loss Data Institute (The IIHS-HLDI I guess?) that backs up our point.

"It looks like teens just can't afford to drive," said Matt Moore, vice president of the insurance industry-funded group. "Paying for their own cars, gas and insurance is hard if they can't find a job. At the same time, kids who count on Mom and Dad to help them also may be out of luck if their parents have been affected by the recession."


Not a shock, but the higher the teen unemployment rate the fewer insured young drivers. Teens have taken a huge hit in terms of employment as jobs that only 17-year-olds would do are now being filled by adults desperate for income.

An additional factor is that states have pushed stricter licensing in the last few years and dropped free driver ed classes.

Ultimately, the study found that "the recession was the most significant factor in the decline to the level of insured teens between 2006 and 2012."


2nd Gear: Analysts Say Tesla Should Be At $45 Per Share

Illustration for article titled Study Says Teens Arent Anti-Car, Theyre Just Broke

The problem with writing about Tesla from any objective standard is that Tesla, by design, does not exist in the same physical universe of other car companies. It doesn't sell cars like other companies, it doesn't perform like other cars, and its buyers all think they're buying into a religion.

Tesla is, often, like Scientology with just more science.

This means that any negative comment about the company is treated as heresy and the stock can float to unbelievable heights despite only selling one car.


Now Tesla Motors stuck is running a little lower on a Bank of America Merrill Lynch report that says the stock price is likely overvalued and set a price target of just $45 a share, reports Chris Woodyard. It closed at $164.50.

Here's the money quote from an analyst:

"The stock has become so divorced from fundamentals that the primary discussion needs to focus on technical analysis."


From pure technical analysis there's no way the company should be worth as much as it is, some analysts have said. I'm in their camp, however, I'm sort of doubtful we'll see it move so far back in the other direction without some sort of shock. But who knows? Tesla has a gravity of its own.

3rd Gear: Ford Is All About The Money, Money, Money

Illustration for article titled Study Says Teens Arent Anti-Car, Theyre Just Broke

Ford will have an even better 2013 after a better-than-expected third quarter net income of $1.27 billion and a pre-tax profit of $2.6 billion, or $.45 per share (compared to expectations of $.38 per share) says Karl Henkel.

Where is all that money coming from? They made a $159 million profit in South America, $126 million profit in Asia, and only lost $228 million Europe. Do the math and that's not a ton which shows that Ford is still primarily a North American automaker.


4th Gear: Focus V. Corolla, Redux

Illustration for article titled Study Says Teens Arent Anti-Car, Theyre Just Broke

Ford has started claiming this year that the Ford Focus is the best-selling car in the world, having moved 589,709 Foci through June around the world according to CBS News.


Toyota has long disagreed with this, stating that Ford calls everything Focus-like a Focus, but Toyota calls its Corolla-based Toyota Matrix a Matrix. If you add Matrix into Corolla sales, they say, the Corolla is actually the best-selling car in the world.

Three things here:

  1. The C-Max is also very much like a Focus but they're not counting the C-Max.
  2. The new Corolla is finally out and may skew this back towards the Focus and it's impressive the Corolla continued to sell almost as many of an inferior product.
  3. he Corolla is an inferior product. Just because Papa Johns sells more pizza than Giordano's it doesn't make it better pizza.

5th Gear: Mercedes Also Seeing A Big Profit Boost

Illustration for article titled Study Says Teens Arent Anti-Car, Theyre Just Broke

Mercedes is the midst of a surge, trying to produce better products, attain more profits, and lower its average customer age.

How are they doing? The new CLA and C Class look like they'll solve two or three of those challenges, with Mercedes parent Daimler reporting a profit of $2.6 billion on a 5% increase in revenues.


Demand in China is helping as well as demand for smaller cars.

Reverse: Celebrate By Getting Stuck In Traffic!

On this day in 1931, eight months ahead of schedule, President Franklin D. Roosevelt dedicates the George Washington Bridge over the Hudson River. The 4,760-foot–long suspension bridge, the longest in the world at the time, connected Fort Lee, New Jersey with Washington Heights in New York City. "This will be a highly successful enterprise," FDR told the assembled crowd at the ceremony. "The great prosperity of the Holland Tunnel and the financial success of other bridges recently opened in this region have proven that not even the hardest times can lessen the tremendous volume of trade and traffic in the greatest of port districts."



Neutral: When Did You Start Driving?
How cheap was it? Did you have a job? Could you have afforded to drive without one?


Photo Credit: Getty Images

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I think I mentioned young people being broke the last time a "Car manufacturers can't understand why young people aren't buying cars" ran. Cars have effectively priced themselves out of a lot of people's reach.

- The average price/income ratio of new cars has risen to insane levels. To compensate for this, automakers have started offering 6,7, even 8 year loans on new cars to make the payments look reasonable.
- Fuel costs are a lot higher than they used to be.
- Insurance costs are insane (my 17 year old daughter's insurance is $1800 a year for one car! My wife and I pay about $700 for 3 cars with a $250 deductible).
- Parking costs in major cities has become ridiculous. I paid $50/day to park in Chicago and NYC.
- Internet communication has made the need to travel less important. Young people are spending more money on technology than transportation.
- Public transportation is a lot better than it used to be.

All of these factors are making car ownership become more of a luxury than a necessity. I'm sure I could live without a car now if I had to. In today's jobless and underpaid economy, a lot of people had to make that choice.