360,000 Fewer Young Drivers Take to the Road Compared to Five Years Ago as Gen Z Navigates Rising Motoring Costs

• Analysis of DVLA data by CarGurus shows a 9.2% decline in the number of 17- to 26-year-olds that hold a full driving licence compared to five years ago (i)
• The number of provisional licence holders has risen by 450,000 over the same period, suggesting Gen Z is keen to get behind the wheel
• With average used car prices hovering 37% above pre-COVID levels according to CarGurus’ data, and high inflation driving up running costs, the decline indicates that Gen Z drivers are being priced out of car ownership
• CarGurus estimates the cost of learning to drive and running a car for a year could reach nearly £11,000 when taking into consideration the cost of purchasing a car
• CarGurus has created a new tool, The First Car Chooser, to help first-time car buyers find the right car for their budget

4 Dec. 2023: New data reveals 360,000 (9.2%) fewer 17- to 26-year-olds hold a full driving licence in 2023 compared with five years ago.

Analysis of Driver and Vehicle Licensing Agency (DVLA) data by CarGurus – a leading automotive marketplace in the UK to shop, buy, and sell used vehicles (ii) – found there were 3.54 million 17- to-26-year-olds with a full driving licence in August 2023, compared to 3.90 million in June 2018 (i).

However, a 16.8% increase (450,000) in the number of provisional licence holders over the same period suggests that Gen Z drivers remain keen to get behind the wheel but are likely being held back by a number of factors, including a sharp rise in motoring costs as well as cancellations of driving tests and a backlog of driving licence applications caused by COVID.

CarGurus’ data shows that used vehicle prices have increased 37% above pre-COVID levels, with the average price of a used vehicle now £19,254. At the same time, inflationary pressures have caused a notable increase in the cost of insurance premiums – particularly for young drivers – as well as fuel, road tax, and vehicle maintenance and repairs.

According to data from the Association of British Insurers, car insurance premiums jumped by 21% in Q2 2023 compared to the same period in 2022 (iii).

Overall, CarGurus estimates the typical cost of learning to drive and running a car in its first year ranges from £7,352 to £10,852 when taking into account fuel, insurance, tax, maintenance, driving lessons, driving test fees and breakdown cover, and the purchase of a car.

Shopper survey data shows that budget is top of mind for young drivers. According to research conducted for the CarGurus Consumer Insights Report, one-in-five Gen Z motorists say that purchasing a vehicle to fit their budget is their number one purchase decision factor, with how a car feels to drive and reliability also high priorities.

To help new drivers find their ideal budget-friendly first car, CarGurus has launched a new tool that pinpoints a used car match based on a user’s individual requirements. Prospective car buyers simply need to answer a few short questions in the First Car Chooser to see which car is best suited to their needs.

Chris Knapman, CarGurus UK Editorial Director, said: “A sharp rise in the cost of an entry-level car, combined with increasing ownership and maintenance expenses, has created the perfect storm for young drivers looking to get behind the wheel. However, with the number of provisional licence holders on the rise, this latest data suggests hundreds of thousands of young drivers are eager to take to the road but are having to put off their test.

“To support those looking to find a reliable and wallet-friendly first car, we’ve created an easy-to-follow guide to buying a first car, which includes our new First Car Chooser tool to help drivers find the right car for their requirements and budget.”

About CarGurus, Inc.
CarGurus (Nasdaq: CARG) is a multinational online automotive platform for buying and selling vehicles. The CarGurus platform gives consumers the confidence to purchase and/or sell a vehicle, and it gives dealerships the power to accurately price, effectively market, and quickly sell vehicles, all with a nationwide reach. The company uses proprietary technology, search algorithms and data analytics to bring trust, transparency, and competitive pricing to the automotive shopping experience.

CarGurus operates online marketplaces under the CarGurus brand in the U.K., Canada, and U.S., where it is the most visited automotive shopping site (iv). In the U.S. and U.K., CarGurus also operates the Autolist and PistonHeads online marketplaces, respectively, as independent brands. Additionally, CarGurus holds a majority stake in CarOffer, a U.S.-based digital wholesale marketplace.

To learn more about CarGurus in the U.K., visit CarGurus.co.uk, and for more information about PistonHeads, the largest online motoring community in the U.K. (ii), visit PistonHeads.com.

CarGurus® is a registered trademark of CarGurus, Inc., and CarOffer® is a registered trademark of CarOffer, LLC. All other product names, trademarks and registered trademarks are the property of their respective owners.

i. UK Government: Driving Licence Data
ii. Similarweb: Traffic Insights, Q3 2023, UK
iii. Association of British Insurers
iv. Similarweb: Traffic Insights, Q3 2023, US