Teens Settling for Less Car, Too

The economy has hurt not only Mom and Dad, but teenage son and daughter as well, who are being asked to pick up more of the tab on the purchase of a new vehicle than they have in previous years.

Thanks to gas prices, there’s also been a big shift in the types of vehicles teens are getting, as they’re being asked to pick up more of the gas tab as well.

About 400,000 new vehicles are purchased for teens each year. Compact and smaller econo cars like the Chevy Cobalt and Ford Focus account for 24 percent of sales to teens this year, up sharply from only 15 percent a year ago.

Compact SUVs like the Jeep Wrangler, however, also account for 24 percent of all vehicles bought for teens this year, but that’s down sharply from 33 percent of sales last year.

A study by CNW Marketing Research, which focuses on why people buy the vehicles they do, also found that thanks to the economy the vehicles teens are getting are low-end models. The average transaction price is $16,000 in 2008, down from $19,200 in 2007 and well below the nationwide average transaction price for all ages this year, $27,800.

While 29 percent of parents picked up the tab on their teen’s new vehicle in 2007, only 26 percent are paying for the vehicle this year. Meanwhile, 44 percent of those teens are being asked to kick in some dough on the payments, up from 38 percent a year ago.

One other stat: 58 percent of vehicles purchased for teens are domestics, versus 37 percent coming from Japanese or South Korean automakers. That domestic dominance is falling steadily, though; it accounted for 63 percent in 2000, while Asian makes have grown in popularity, up from 32 percent of the mix in 2000.