Expect car costs with older clients

Expect car costs with older clients

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In case you need further proof of the generation gap, new data reveal where younger and older Canadians differ: car ownership.

While car payments, insurance and gas might not be included in younger clients’ cash flow plans, those items will continue to factor in for older clients.

In fact, those age 75 or older are contributing to an increase in insured vehicles, finds Groupement des assureurs automobiles. Between 2011 and 2016, the increase for this age group was 26% among men and 36% among women. For those 65 to 74, the increase was 28% and 37%, respectively.

Younger clients aren’t buying in. For young men ages 16 to 24, there was a 10% drop in the number of insured vehicles in the last five years. For women of the same age, the drop was 2%.

Read: Millennials’ top planning concerns

“The stats clearly show a generational shift. Owning a car is not a must for [younger Canadians],” says Anne Morin, supervisor, public affairs, at Groupement des assureurs automobiles, in a release.

Read: When should young people buy life insurance?

Auto sector investment drops

Meanwhile, a new report from DesRosiers Automotive Consultants says there’s “no sustained indication” that Canada’s automotive manufacturing sector will return to pre-recession levels of capital investment.

Capital spending for Canada’s motor vehicle assembly industry has averaged just $1.2 billion a year since 2010, says the report.

That’s down from $2.3 billion annually on average from 2000 through 2009 — a period that included a deep recession that hammered automakers.

DesRosiers says parts and accessories manufacturers have also dropped capital spending to $565.9 million from $887.7 million prior to the recession.

Canada’s loss of investment to Mexico and the southern U.S. has already been well documented, says DesRosiers.

There is, however, a bright spot: investments by truck body and trailer manufacturers have increased on average from $52.7 million for 2000 to 2009, to $82.7 million since 2010.

Also read:

U.S. retail sales fall for second consecutive month

What investors can learn from self-driving cars

More Canadians buying individual life insurance

Published at Wed, 11 Oct 2017 12:32:27 -0400