It has already been 134 years since modernized vehicles with internal combustion engines first came. Of course, compared to the entire history of mankind, 134 years would be nothing. However, automobiles have affected people's lives in countless ways, not to mention economic and social aspects. The interaction between people and cars has created keywords that symbolize these changes in life. Here are some of the social keywords that have had a huge impact on our society in the past few years, and let's take a look at how they changed the auto industry, then our lives as well.
1. The MZ Generation
The MZ generation, which is familiar with mobile devices, is now one of the most trendy consumers.
The MZ Generation includes the Millennial Generation and Generation Z. Millennials refer to those born from the early 1980s to the mid-1990s, and Generation Z from the mid-1990s to the mid-2000s. In other words, the MZ generation is now in their 20s and 30s.
The generational distinction is usually apparent when life, way of thinking, and propensity to consume vary significantly on a specific time basis. The same is true of the MZ generation. They are usually represented by the mobile devices that they have been using since childhood. In addition, they tend to pursue joy and pleasure in their lives, rather than getting prepared for the long-term future. This is because of the global economic turmoil in the late 2000s. In particular, the people in that generation prefer sharing over ownership, values diversity and individuality, and is open to other cultures.
Subscription services that draw attention these days provide the option of replacing the car.
As the MZ generation has emerged as key consumers, their taste has become a great concern for those who develop products and services. In particular, their attitude toward cars is so different from the previous generation that it is affecting how companies develop products and services. One example is the automakers that are introducing subscriptions providing the option of replacing the car. According to the data by market research firm Mobility Forsights, the car subscription service first appeared in 2017 and expanded to 20 car brands around the world until December 2019. Of course, the number of rental car companies and start-ups that provide subscription-based services would be much bigger than that.
All brands of Hyundai Motor Group offer subscription services.
In Korea, Hyundai Motor Company, Kia Motors, and Genesis began offering subscription through Hyundai Selection, Kia Flex, and Genesis Spectrum, respectively, from 2018. To be specific Hyundai Motor Group analyzed their customer preference and usage patterns from the beginning, and strengthened its services by expanding product types and sales channels.
Car sharing services are also gaining popularity among the MZ generation. According to data released in April 2019 by app research firm WiseApp after analyzing domestic credit and debit card payment data, 87 percent of the nation's major car-sharing service users were in their 20s and 30s. In addition, data released by the Korea Information Society Agency in April 2019 showed that 76.8 percent of car-sharing service users were in their 20s and 30s. Car-sharing is considered a service that is well suited to the MZ generation, as known as 'digital native' because smartphone applications are essential for the services.
2. WLB / Yolo
WLB and Yolo, which have become a trend among the younger generation, have also affected the automobile usage patterns.
There are more trending words other than the MZ generation above - 'WLB', and 'YOLO'. WLB is short for the English phrase 'Work-Life Balance'. YOLO is also derived from the English sentence ‘You Only Live Once.’ Although the two expressions have different meanings, they have so much in common; the way the young MZ generation treats life.
The younger generation is living for themselves, away from a work-oriented life.
The essence of work-life balance is a job that guarantees privacy. Unlike the older generation who used to value their work, sometimes more than themselves, the younger generation is more inclined to spend quality time for themselves, such as leisure time and hobbies, when they finish their work hours. This also comes from their philosophy, who values individuality more than anything. Meanwhile, owning a house became much more difficult to achieve for such high real estate prices, and more people suffer from overtime work and low wages. This is how 'Yolo' was born, which means "You only live once, so live as you wish," and the term drew much attention.
The tendency to value leisure time has also affected the surge in RV sales that are useful for leisure activities.
This trend is also seen in the use/purchase of cars by the MZ generation. The data from the Korea Information Society Agency cited earlier showed that car-sharing users mostly use leisure/travel (40.4 percent), other (25.2 percent), and shopping (16.0 percent) on weekdays. This means that the MZ generation mainly uses car-sharing as a means to spend leisure time.
In particular, camping became much more popular for so-called 'social distancing' due to the recent COVID-19 pandemic. According to statistics released by the Korea Automobile Manufacturers Association in July, RV sales, including SUVs and MPVs (minivans), accounted for 346,000 units, or 43.3 percent of the total passenger car sales among the five domestic carmakers sold in Korea. This is the highest percentage of RV sales ever.
3. The 58 Generation
The 58 generation is more active in their lives and consuming than other older generations are.
There is also 'the 58 generation' in Korea; those people are in their 50s and 60s, called the baby boomers, or those who are born in 'the year of the dog,' and the 58 generation refers to 'the old people with active lives'. Some people call them 'the new elderly.'
The difference between the average older generation and the 58 generation is that they actively react to the influence of the younger generation on their lives and consumer behaviors. Their characteristic is that they are enthusiastic about culture and leisure activities based on their wealth accumulated through their youth and middle age, and actively utilize digital devices and media to narrow the gap with the younger generation. It is also common for the 58 generation to share and enjoy what the younger generation is interested in.
People in their 50s and 60s are the biggest automobile consumers.
The 58 generation is as important as the MZ generation in the automobile industry. According to data released by the ‘Car is you data research institute’ based on the latest registration statistics from the Ministry of Land, Infrastructure and Transport, the age groups that registered new cars the most in Korea from January to August this year was those in their 50s, and then followed by 40s, 30s, 60s, and lastly, 20s. 28 percent of the automobile consumers were in their 50s, and 50s and 60s altogether accounted for 47 percent of the total consumers, which was even more than those in their 30s and 40s combined (45 percent).
Reflecting this trend, Hyundai released the new Avante(Elantra) in April, drawing attention from the TV advertisement as it showed older people driving the car to enjoy their life. Kia Motors also held the Golden Age promotion from March to May; the promotion offers the elderly who are over 60 special price and comprehensive medical checkups.
4. Health Care
Health care is also emerging as an important keyword in the automotive industry as people tend to stay longer in their vehicles.
The term 'healthcare; has long meant things related to medical treatment. But recently, the criteria has become much wider. In addition to preventive medical services such as health checkups, various activities to protect health in everyday life are all within the category of healthcare. The medical and related industries call this era 'healthcare 3.0'. This is largely due to the aging population. As chronic diseases and age-related diseases have become big problems in society as a whole, and it has become important to come up with preventive solutions.
As people spend a long time in their cars, cars are also becoming the potential space for healthcare. Cars that have tech features detecting drivers' fatigue and recommend them to take a rest, warn them when they are driving carelessly, and help them drive safely with massage seats are now widely available.
Automakers are suggesting various measures to improve the health of passengers and one of them is improving indoor air quality.
In addition to the volatile organic compound (VOC) regulation for automobile interior materials in many countries around the world, consumers are increasingly interested in indoor air quality. Especially in Korea, where yellow dust and fine dust have become serious social problems, indoor air quality tends to be more important. Reflecting this trend, more and more auto brands are including air purifiers as a basic or optional feature. Hyundai's recently released Tucson also offers three new air-conditioning features that keep indoor air quality fresh, including fine dust concentration monitoring and air purifying.
In addition, the development of connectivity technology in automobiles can help respond to changes in passengers' health conditions while on the move. The technology that automatically requests emergency rescue in the event of an accident or an emergency through the connectivity (telematics) service is already being applied to many cars. Last summer, there has been news about a person driving a Kia Niro EV quickly rescued from a car accident through UVO's automatic airbag deployment feature, which is one of Kia's connected car services.
5. Calm-Tech
On the journey to the destination, the passenger is benefiting from a number of technologies.
'Calm-Tech' is a compound word of 'Calm', and 'Tech,' meaning technology. Calm-Technology was first mentioned in a paper titled written by former PARC Researchers Mark Weiser and John Seely Brown in the U.S., meaning 'getting information without needing to focus or pay attention." In other words, it refers to a technology that delivers necessary information to users or performs functions without showing.
Automobiles are one of the areas where calm-tech is quickly settling down. This is because as the in-car technologies become more diverse and complex, it has become difficult for drivers to access and manipulate various technologies directly. In particular, if you get distracted trying to control those features while driving, it can lead to accidents, so calm-tech helps not only passenger convenience but also safety.
Recently, the automotive air-conditioning system has become surprisingly smart with the rise of calm-tech.
Among the calm-tech features, one of the easiest to come up with is an intelligent air conditioning system. It automatically turns on the air circulation mode and the air purifier if the concentration of harmful substances is high through detecting the air quality even if the driver does not do anything. Another good example would be the air-conditioning system automatically closing windows and switching to a circulation mode before entering a tunnel based on the information from the navigation system.
ADAS, which helps comfortable driving, would be the essence of calm-tech.
Self-driving is the most advanced form of calm-tech in automobiles. This is because the driver can get to the desired destination without paying attention to driving. In fact, we do not even need to talk about autonomous driving. The current Advanced Driver Assistance System (ADAS) also uses sensors to help detect surroundings and respond to dangers. The technology for preventing a collision when another car is in a blind spot, or automatically braking when the car approaches from the rear side while reversing is also a kind of calm-tech.
6. Non-face-to-face
As non-face-to-face services are becoming a new normal, more and more cars are equipped with in-vehicle payment systems.
Non-face-to-face or contactless, also called 'untact,' is one of the most widespread expressions along with the COVID-19 pandemic. However, non-face-to-face was one of the keywords that drew attention even before the COVID-19. Ordering and payment systems used in fast-food restaurants, convenience stores, supermarkets, mobile shopping, and delivery apps have already started to implement non-face-to-face systems. And after the COVID-19 pandemic took place, non-face-to-face activities and services to reduce infection through contact, are spreading faster than ever.
The story goes the same with the automotive sector, so new types of services are emerging one after another to adapt to the era of non-face-to-face. In particular, the sales and service sectors, which have heavily depended on close contact with consumers, are facing the biggest changes. Considering that consumers are now avoiding going to stores or customer centers in person, companies are providing online solutions.
Amid the rapidly changing market, the mobility service trend is also changing.
In major auto markets such as the U.S. and Europe, online car sales have been on the rise due to the COVID-19 pandemic. This is not unprecedented, of course. Some car brands sell their cars online only, not through offline dealerships. In addition, similar movements are being made in the service sector. Major domestic and foreign automakers have already established a system to book maintenance services through the internet or mobile apps.
As we have seen so far, social keywords symbolizing changes in life have affected not only how we use our cars but also how automakers develop technologies. This also proves that cars have evolved, having a great influence on all of us. How will cars affect our lives in the future? This is why we all are happily expecting future mobility.
Words. Chung-hee(Jason) Ryu
Chung-hee(Jason) Ryu is doing his work in automotive journalism over twenty years and most of the period as a freelancer. He was a staff writer for well-known automotive magazines in South Korea such as ‘Carlife’ and ‘Motor Magazine’, and also an author of 'Explaining Automotive Terms and Basics' and 'The Car Inside-out'. He is a jury of International Engine and Powertrain Of The Year awards, since 2017.
**Any opinions expressed in this material are those of the author, and do not necessarily reflect the views of the HMG.
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