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Why are Millennials forgoing driving?

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Olivia Harris/Reuters/File

(Read caption) School friends Jannat and Wahid sit in a Maybach hired to take part in a parade of 'supercars' during Morpeth School graduation day in Tower Hamlets, east London, June, 2013.

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A study published on Tuesday by the Transportation Research Institute at the University of Michigan indicates that Millennials are increasingly choosing to give up cars.

It was once a coming of age ritual: before eating cake and opening presents, newly-minted 16-year-olds would make a white-knuckled pilgrimage to the state Department of Motor Vehicles for a chance at the small plastic card that meant freedom. Today, researchers say, fewer teenagers and young people in general are obtaining drivers licenses.

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The University of Michigan report states that licensing has decreased from 91.8 percent to 76.7 percent for the 16-year-old to 44-year-old demographic. Only 60 percent of 18-year-olds had a drivers’ license in 2014, compared to 80 percent in 1983. The study also notes a decrease in those with driver's licenses across all age groups from 2011-2104.

The Millennial generation, composed of young adults and adults born between 1983 and 2000, is even larger than the Baby Boomer generation. There are 92 million Millennials, compared to 77 million Baby Boomers.

Is the decrease in driver’s licensing rates indicative of a larger societal trend? Why are Millennials so apathetic towards driving?

Answers to these questions differ. While the constraints that define Millennials as a generation also likely define car ownership and drivers’ licensing, evidence suggests that the trends identified in the University of Michigan’s study are structural shifts rather than generational ones.

Millennials carry more debt than their Baby Boom and Generation X counterparts. They also have less disposable income and different economic priorities than their predecessors. Due to social and economic trends, such as the rise in college tuition and lower employment rates for new graduates, Millennials have been driven to cities where public transportation reduces the need to drive. 

Millennials are also choosing to marry and have children later, trends that can slow patterns of migration to the suburbs, where car ownership is more necessary.  

Some blame the recession in 2008. But according to a 2014 study by the United States Public Interest Research Group (PIRG), these patterns were in place prior to the recession. Driving rates fell among Millennials both with and without jobs, suggesting that car use is not merely dependent on economic factors.

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A 2012 article in The Atlantic, called “The Cheapest Generation,” found that Millennials drove fewer miles and bought fewer cars than preceding generations. A response published by the same author in 2015 indicated that although Millennials actually buy more cars than Generation X today, auto sales will likely never peak the way they did with the Baby Boom generation. Drivers today simply driver fewer miles than previous generations, and modern services make it easier not to own a car.

The PIRG study indicates that the advent of ride-sharing apps, such as Lyft and Uber, has led to a reduction in car ownership. The study states that these apps, “could lay the groundwork for a new model of mobility that is less dependent on private car ownership.”

Mark Wakefield, automotive consulting expert at AlixPartners, agrees that other transportation options have an impact on the traditional auto market.

Mr. Wakefield says, “You still have people passionate about driving. But you have more people now who are frustrated with driving and have options that didn’t exist in the past.”

Yet, the sharing economy has its drawbacks. Dr. Brandon Schoettle, one of the lead researchers that produced the University of Michigan’s study, says that “We do think that as many [Millennials] age and the economy improves, a large number will become more interested in getting a license. Services like Uber and Lyft don't always satisfy the needs of drivers, like taking kids to school and other family-oriented travel.”

At the moment, it is hard to tell for certain whether licensing will remain low. Although more Millennials may get drivers’ licenses as they age, studies seem to indicate that a structural shift in driving habits is occurring.