Why aren't Americans buying new cars?
For any number of reasons, the average age of vehicles on US roads has grown to an all-time high - 11.9 years - according to data from IHS Markit, with roughly a quarter of privately owned passenger vehicles counting 16 years or more. That may seem like dire news, but it's actually not all bad; Todd Campau, IHS Markit's Associate Director of Aftermarket Solutions, says "a lot of it has to do with quality of the vehicles on the road."
Customers with aging cars "are comfortable keeping that vehicle longer than they would in the past," he says, which is a testament to how much vehicle longevity has improved over the years.
At the same time, it's reasonable to suspect that the growing average age of vehicles on the road has perhaps just as much to do with a lack of affordability. While many Americans' wages have stagnated, the advent of technologies like backup cameras, blind spot monitoring, and distance-pacing cruise control is working to inflate new vehicle MSRPs. The new 2021 Ford F-150, for example, is a rocketship compared to its barebones forebears, with an eight-inch SYNC 4 infotainment system and automatic emergency braking fitted as standard even on the utilitarian XL model. But, it's priced to match.
Add to that the economic difficulties posed by the coronavirus pandemic, not to mention the fact that many Americans are keeping the miles off by not commuting as much, and IHS Markit only expects the average passenger vehicle age to grow from its current 11.9 years old - by as much as four to six months over the coming years.
To put that 11.9-year-old age in perspective, the average US car was 10.6 years old just a decade ago, and 9.6 years old back in 2002. Even as recently as January 2019, the average passenger vehicle was a month younger than it is today.
According to IHS, the US today has a record 280 million passenger vehicles registered. A total of 14 million new cars are expected to be registered in the US this year - about 5 percent of all vehicles on the road.