Once upon a time a consumer might purchase a new car every two or three years, trading in their vehicle on a newer model. It probably never made a lot of financial since and makes even less today.
Not surprisingly, data supplied from a survey of nearly 4,000 car owners suggest very few people think frequent trade-ins are practical. Seventy-eight percent of those questioned said owning a car for 10 or more years, “or until it dies,” is the appropriate vehicle life span.
Over 50 percent of the drivers in the survey said even a better economy wouldn't change that.
In spite of reports from automakers showing near record sales, the data suggest the U.S. automotive fleet is aging. In part that's because today's cars last longer than those of the past.
When consumers engaged in frequent trade-ins, it was also spurred by “planned obsolescence,” when the average car was ready for replacement a lot sooner. Driving a car 100,000 miles was unusual.
Now 100,000 miles is considered young for some cars, especially if they have been well cared-for by their owners. It's not unusual for many models to hold up for 200,000 or more miles.
100K and counting
For the second year in a row, 60 percent of respondents in the AutoMD survey say their primary vehicle has over 100K miles. Sixty-six percent plan to drive their primary vehicle for over 150K –- or until it dies -- and over half plan to rack up 75K more miles than on their previous vehicle.
While the economy continues to be the number one reason for holding on to vehicles, improvements in initial quality and maintenance now appear to be a main driver.
"There is nothing surprising about the economy driving car owners to hold onto their vehicles for longer -- our data has been showing this trend for the past three years,” said Brian Hafer, VP of Marketing at AutoMD.com. “But what is most compelling is that longer ownership has become an embedded habit for car owners, regardless of what the economy does."
Another factor in longer ownership is cost. A new car can easily cost $30,000. A consumer making payments for five or more years will want to drive it a long as possible without making payments to get the full value.
Hafer said he believes this is a trend that's here to stay, supported by better vehicles and more repair options.