The average car on America’s roads is now 12.1 years old – a record high. A new report from IHS Markit finds that “while the average vehicle age has risen steadily over the last 15 years, the trend accelerated during the coronavirus pandemic.”
Improving Quality Means Cars Last Longer
Improvements in quality across the automotive industry have driven much of the change. In a statement, the company explains, “whereas 20 years ago a car might have changed hands once or twice and lasted 100,000 miles, it is more common today for a car to have multiple owners and last for 200,000 miles or more.”
Americans also slowed the pace of car buying during COVID-19-related lockdowns. But, they are buying cars now – by some measures, car sales hit record highs this spring.
New Car Sales Don’t Necessarily Mean a Younger Fleet
That may not drive the average age down much, though. Not every new car sale pulls an older car off the road. “Consumers have been adding to their number of household vehicles– buying a third car for the family instead of getting by on two, for example,” IHS Markit reports. “The total number of vehicles in operation in the U.S. has risen about 10% since 2013, to around 279 million.”
Automakers Searching for Ways to Make Money Long Term
That is driving changes in how automakers approach their business. “Automakers are looking to offer digital services and features after the sale to generate recurring revenue,” IHS Markit says. These include “adding new apps to multimedia systems or new convenience features such as hands-free driving in some situations.”
At the extreme of innovation, some are exploring subscription models for car ownership, where drivers would pay fluctuating monthly fees, activating and deactivating features as their needs and tastes change.
