Millennials enter the car market ... carefully

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A Smart car draws attention at the Chicago Auto Show in early 2016. Those in the millennial generation tend to see cars as more utilitarian.

Branden Matlock, 32, finally relented, buying a car for perhaps the most millennial of reasons:

"I wanted to supplement my income, so I decided to drive for Uber and Lyft part-time."

So after two years, Matlock bought a used 2012 Prius V in November for $10,000.

Millennials, typically defined as people born between 1980 and 2004, have produced plenty of anxiety in recent years for automakers, who worried they might kick-start a major downturn for the industry.

The caricature is all too familiar: Entitled young people who embrace the sharing economy to such an extent they simply don't have much interest in buying cars. After some initial hesitation, though, it appears millennials are not so car-averse after all.

A 2016 J.D. Power's Power Information Network study reported that the share of millennials in the new-car market jumped 28 percent. By 2020, they are expected to make up 40 percent of U.S. car sales.

"They've been delaying their purchases of vehicles," said Brian Maas, president of the California New Car Dealers Association, "but they're still going to enter the market."

The spike is not that surprising: It's only natural to presume that as 20-year-olds turn into 35-year-olds, they become more likely to buy cars, as every generation did before them.

"When you think about it, people are having families later, they're getting married later, they may be leaving their home later - all of those factors," Maas said. "So it makes logical sense that they might buy their cars later, too."

But there are indications millennials look at cars in a more utilitarian way, not as an extension of personality or social status. An online survey conducted in September for the personal-finance website NerdWallet reported that while 75 percent of millennials who own a car plan to buy another in the next five years, they just don't seem to be that into it. About 43 percent called owning a car a hassle.

A University of Michigan study showed only about 60 percent of 18-year-olds have driver's licenses, compared to 80 percent in the 1980s. And while another 2016 study from LendingTree.com showed an uptick in auto loans for drivers 18 to 34, the average loan amount was $3,000 lower than for those 35 and up.

"You have this generation of millennials, and they seem very stubborn about entering the new-car market," said Jeremy Acevedo, pricing and industry analyst for Edmunds.com.

Many seem to avoid buying flashy cars and look instead at more practical considerations, perhaps as a concession to college debt. But a 2013 study of millennial car shoppers by AutoTrader reported more than 70 percent listed technology and infotainment features as "must-haves."

November's Los Angeles Auto Show included what is called a "mobility revolution," the latest gadgetry including autonomous cars and products aimed at younger audience.

"While we will continue to make great vehicles, they are no longer our entire game," Ford CEO Mark Fields said. "We are attending the first major automotive show in the world that isn't just about cars."

Though many millennials are attracted to city centers, as they get married and raise families, the high price of housing may force them to move.

"The cost of housing and just the need for space will drive people out to places that are less dense," Acevedo said. "And less density means you need a vehicle to get around."