The Boomer Boom

Auto dealers are rethinking their marketing pitches and returning to traditional sales practices as new data shows baby boomers now make up almost 50 percent of all new-car buyers in the United States.


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Carl Galeana, president of Galeana Van Dyke Dodge, says he uses traditional marketing programs to reach buyers aged 55 years or older.

Photograph by Josh Scott

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In a tale of diverging trends among new-car buyers, Jim Horner, a retired technical writer from West Bloomfield, recently bought an Audi A4 from the same dealer and the same salesperson who had sold him four previous Audis. And he paid cash each time.

“We had an 8-year-old car and we were admiring the new ones at the auto show. My wife said, ‘If you’re going to get a new car, you might as well get a nice one because it might be your last,’ ” Horner says.

At the polar opposite end of the market is Lara Dent, a 25-year-old Michigan State University graduate who is content driving her 2005 Saturn Ion to and from her job at Oakland University in Rochester Hills. She has no plans to replace it any time soon.

“I don’t feel the need to get a new car; it isn’t a very wise investment,” Dent says. “You can get a used car that’s in fairly good shape for significantly less.” She says once her basic living expenses are paid, any extra money goes to savings and paying off student loans. “There are more important things to put your money into than a car,” she says.

Horner and Dent represent a phenomenon that is shifting the landscape of U.S. auto sales, and possibly the way automakers and dealers market their products, according to new data compiled by Foresight Research, a marketing and research firm in Rochester. After interviewing 7,500 to 8,000 new-car buyers across the country, Foresight found car buyers under age 35 fell to 16 percent of the total market in 2012, down from 25 percent in 2009. During the same time period, buyers 55 and older made up 47 percent of the market, compared to 33 percent in 2009.

“What’s going on here? To be frank, we’re not sure,” admits Foresight CEO Steve Bruyn. “There are two possibilities. One is short-term: There’s been a crummy economy the last few years, and the people who were hurt the most by higher levels of unemployment and job loss were young people. They were also the group that had the most difficulty getting financed. If it’s a short-term issue, that’ll turn around.

“The other theory is that this situation is here to stay,” Bruyn continues. “It’s all about the baby boomers moving into their early 60s. The effects of this are long-term because they will probably live another 20 to 30 years, and people buy cars well into their 70s. The over-55-year-olds have the dollars, they have life expectancy, and they are moving to different segments because style, technology, and creature features have migrated into smaller cars. If this group continues to be 47 percent of the market, there will be profound changes in the way cars and trucks will be marketed.”

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