Telematics and Generation Y: Making the car an iPhone on wheels
22 Feb 2011
Telematics Update's Jeremy Slater finds opportunities for telematics regarding generation Y, consumers born between 1982 and 2001, who are set to become early adopters of connected cars. Telematics systems are becoming standard because of a new type of automotive consumer- the millennials. Members of this or Generation Y have grown up using more technological devices than any age group before them. Although they tend to be more tech-savy than their elders, they do not have the same buying power as older generations, which has encouraged OEMs provide telematics with mid-range cars.
Technology as a key differentiator
Such devices also meet the eco-consciousness of this generation. According to a survey by rental car company Zipcar, 67% of respondents said they would like to drive less, mainly because of the high cost of owning a car, including filling the tank. According to Zipcar CEO Scott Griffith, the report confirms that new technologies and services make it possible to have access without ownership. If manufacturers are to persuade these consumers to keep driving they need to offer more.
As millennials list in-car technology as one of the most important attributes when buying a car, telematics is key to holding them in the driver's seat. This demographic will make up 40% of the car-buying market in the US by next year; in Europe, the numbers are predicted to be similar. Generation Y wants more high-tech features, such as Bluetooth and Internet connectivity in their vehicles, more human-machine interfaces (HMIs), and devices like haptic controllers.
„An iPhone on wheels" is, according to Slater, what the millennial consumer wants his or her car to be. Furthermore, they also appreciate having substantial information about the car model online and are very interested in improving a car's performance. „Our findings point to technology as a key generational differentiator," says Craig Giffi, vice-chairman and automotive practice leader, Deloitte LLP.
Sales of telematics systems in Europe are expected to grow by a facter of five between 2008 and 2016 according to iSuppli's recent study. If rapid growth is to continue, manufacturers will need to make sure their offerings appeal to the need for connection among millennial consumers.