A joint model for vehicle type and fuel type choice: evidence from a cross-nested logit study

In the face of growing concerns about greenhouse gas emissions, there is increasing interest in forecasting the likely demand for alternative fuel vehicles. This paper presents an analysis carried out on stated preference survey data on California consumer responses to a joint vehicle type choice and fuel type choice experiment. Our study recognises the fact that this choice process potentially involves high correlations that an analyst may not be able to adequately represent in the modelled utility components. We further hypothesise that a cross-nested logit structure can capture more of the correlation patterns than the standard nested logit model structure in such a multi-dimensional choice process. Our empirical analysis and a brief forecasting exercise produce evidence to support these assertions. The implications of these findings extend beyond the context of the demand for alternative fuel vehicles to the analysis of multi-dimensional choice processes in general. Finally, an extension verifies that further gains can be made by using mixed GEV structures, allowing for random heterogeneity in addition to the flexible correlation structures.     

Consumer preferences for electric vehicles: a literature review

Widespread adoption of electric vehicles (EVs) may contribute to the alleviation of problems such as environmental pollution, global warming and oil dependency. However, the current market penetration of EV is relatively low in spite of many governments implementing strong promotion policies. This paper presents a comprehensive review of studies on consumer preferences for EV, aiming to better inform policy-makers and give direction to further research. First, we compare the economic and psychological approach towards this topic, followed by a conceptual framework of EV preferences which is then implemented to organise our review. We also briefly review the modelling techniques applied in the selected studies. Estimates of consumer preferences for financial, technical, infrastructure and policy attributes are then reviewed. A categorisation of influential factors for consumer preferences into groups such as socio-economic variables, psychological factors, mobility condition, social influence, etc. is then made and their effects are elaborated. Finally, we discuss a research agenda to improve EV consumer preference studies and give recommendations for further research.

Abbreviations: AFV: alternative fuel vehicle; BEV: battery electric vehicle; CVs: conventional vehicles; EVs: electric vehicles; FCV: fuel cell vehicle; HCM: hybrid choice model; HEV: hybrid electric vehicle (non plug-in); HOV: high occupancy vehicle; MNL: MultiNomial logit; MXL: MiXed logit model; PHEV: plug-in hybrid electric vehicle; RP: revealed preference; SP: stated preference.     

A choice experiment on alternative fuel vehicle preferences of private car owners in the Netherlands

This paper presents results of an online stated choice experiment on preferences of Dutch private car owners for alternative fuel vehicles (AFVs) and their characteristics. Results show that negative preferences for alternative fuel vehicles are large, especially for the electric and fuel cell car, mostly as a result of their limited driving range and considerable refueling times. Preference for AFVs increases considerably with improvements on driving range, refueling time and fuel availability. Negative AFV preferences remain, however, also with substantial improvements in AFV characteristics; the remaining willingness to accept is on average € 10,000–€ 20,000 per AFV. Results from a mixed logit model show that consumer preferences for AFVs and AFV characteristics are heterogeneous to a large extent, in particular for the electric car, additional detour time and fuel time for the electric and fuel cell car. An interaction model reveals that annual mileage is by far the most important factor that determines heterogeneity in preferences for the electric and fuel cell car. When annual mileage increases, the preference for electric and fuel cell cars decreases substantially, whilst the willingness to pay for driving range increases substantially. Other variables such as using the car for holidays abroad and the daily commute also appear to be relevant for car choice.     

Are consumers willing to pay to let cars drive for them? Analyzing response to autonomous vehicles

Autonomous vehicles use sensing and communication technologies to navigate safely and efficiently with little or no input from the driver. These driverless technologies will create an unprecedented revolution in how people move, and policymakers will need appropriate tools to plan for and analyze the large impacts of novel navigation systems. In this paper we derive semiparametric estimates of the willingness to pay for automation. We use data from a nationwide online panel of 1260 individuals who answered a vehicle-purchase discrete choice experiment focused on energy efficiency and autonomous features. Several models were estimated with the choice microdata, including a conditional logit with deterministic consumer heterogeneity, a parametric random parameter logit, and a semiparametric random parameter logit. We draw three key results from our analysis. First, we find that the average household is willing to pay a significant amount for automation: about $3500 for partial automation and $4900 for full automation. Second, we estimate substantial heterogeneity in preferences for automation, where a significant share of the sample is willing to pay above $10,000 for full automation technology while many are not willing to pay any positive amount for the technology. Third, our semiparametric random parameter logit estimates suggest that the demand for automation is split approximately evenly between high, modest and no demand, highlighting the importance of modeling flexible preferences for emerging vehicle technology.     

Factors influencing the purchasing decisions of low emission cars: A study of Slovenia

This paper presents a study of customer preferences and opinions about alternative fuel vehicles. Nowadays the studies of green technologies, especially in the area of green transport, are interesting for policy makers, vehicle producers, customers and energy suppliers. Many stakeholders from public and private sector are investing a lot of effort to identify consumer behaviour for future improvements in development of their green products and strategies. This study is a modification of previously conducted research on customer behaviour on the same topic in Scotland. The survey includes almost 700 participants to identify the most important parameters of consumer behaviour related to purchase of alternative fuel vehicle. Therefore the questionnaire includes different factors, combining financial and technical aspects, environmental performance and vehicle design. Results have revealed that the most relevant factor for purchasing low emission vehicle is total vehicle price, and that the segment of potential alternative fuel vehicles buyers is much larger than we initially anticipated. Such vehicles are, surprisingly, also more attractive for the older population, according to our results.     

Effects of providing total cost of ownership information on consumers’ intent to purchase a hybrid or plug-in electric vehicle

Energy-saving technologies have a difficult time being widely accepted in the marketplace when they have a high initial purchase price and deferred financial benefits. Consumers might not realize that, in the long-run, the financial benefits from reduced energy consumption offset much or all of the initial price premium. One strategy to address consumer misconception of this advantage is to supply information on the “total cost of ownership”, a metric which accounts for the purchase price, the cost of the fuel, and other costs over the ownership period. In this article, we investigate how providing information on five-year fuel cost savings and total cost of ownership affects the stated preferences of consumers to purchase a gasoline, conventional hybrid, plug-in hybrid, or battery electric vehicle. Through an online survey with an embedded experimental design using distinct labels, we find that respondent rankings of vehicles are unaffected by information on five-year fuel cost savings. However, adding information about total cost of ownership increases the probability that small/mid-sized car consumers express a preference to acquire a conventional hybrid, plug-in hybrid, or a battery-electric vehicle. No such effect is found for consumers of small sport utility vehicles. Our results are consistent with other findings in the behavioral economics literature and suggest that further evaluation of the effects of providing consumers with information on the total cost of vehicle ownership is warranted.     

The inconvenient truth about improving vehicle fuel efficiency: A multi-attributes analysis of the technology efficient frontier of the US automobile industry

Vehicle fuel efficiency has taken on more economic and environmental significance due to the rise in gasoline prices in 2007/2008. We examine adoption of fuel efficiency technologies by the US automobile industry between 1985 and 2002 and consider the environmental implications. The technology efficient frontier between vehicle weight and fuel efficiency of the US automobile fleet did not move outward significantly for an extended period in the 1980s and 1990s indicating a lack of company- or industry-wide adoption of new fuel efficiency technologies. While the firm with inferior technology capability did push its efficient frontier outward to close the technology gap, the two leading firms’ efficient frontiers first showed signs of possible regression in the early 1990s, and did not move outward significantly until the mid 1990s. Several managerial and policy options are examined for improving vehicle fuel efficiency.     

Consumer preferences for electric vehicles in lower tier cities of China: Evidences from south Jiangsu region

China is the world biggest market of electric vehicles (EVs) in terms of production and sales. Existing studies on consumer preferences for EVs in China have generally focused on first-tier cities, while little attention has been paid to the lower tier cities. This exploratory study investigates consumer preferences for EVs in lower tier cities of China, by collecting stated preference (SP) data in two second-tier cities and three third-tier cities in the south Jiangsu region of China. The discrete choice modeling analysis shows that Chinese consumers in lower-tier cities are generally sensitive to monetary attributes, charging service and driving range of EVs. They also perceive Chinese vehicle brands to be disadvantaged compared with European brands. When comparing the differences in second-tier versus third-tier cities, we find that consumers in third-tier cities are more sensitive to purchase price, subsidy of purchase, and coverage of charging stations than their second-tier counterparts. This study also highlights the role of different psychological effects, such as symbols of car ownership, normative-face influence, and risk aversion, in shaping consumer preferences for EVs in lower-tier cities of China. Our results provide important implications for contextualizing government policies and marketing strategies in line with the different sizes and characteristics of the cities in China.     

Controlling vehicular emissions in Beijing during the last decade

The vehicle population of Beijing is sharply increasing at an average annual rate of 14.5%, causing severe transportation and environmental problems. The Beijing municipal government and the public have worked hard to control vehicular emissions since 1995. Strategies and measures have been introduced to regulate land use and traffic planning, emission control of in-use vehicles and new vehicles, fuel quality improvement, introduction of clean fuel vehicle technology and fiscal incentives. New development plans for Beijing will change the transportation structure by encouraging public transportation. For in-use vehicles, the I/M program has employed ASM tests since early 2003 and the government has encouraged the retirement of high-emission vehicles. For new vehicles, Beijing introduced Euro 1 and Euro 2 emission standards in early 1999 and 2003, respectively. It is also confirmed that Euro 3 standards will be introduced in 2005. At the same time, the fuel quality in Beijing was improved significantly, by banning lead and reducing sulfur among other changes. CNG and LPG were introduced in 1999 and are used in buses and taxis. Today Beijing has the largest CNG bus fleet in the world with more than 2000 dedicated CNG buses. Beijing has also focused on fiscal incentives such as tax deductions for new vehicles meeting enhanced emission standards to encourage their sales. These strategies and measures have had an impact on the control of vehicular emissions. Despite the rapid increase of the vehicle population by 60% between 1998 and 2003, total vehicular emissions have not increased. With the enhancement of vehicular emission control, the air quality in Beijing is improving as the city strives to its goal for a “Green Olympics”.     

Recent advances in automotive technology and the cost-effectiveness of fuel economy improvement

The potential for improving the fuel economy of conventional, gasoline-powered automobiles through optimized application of recent technology advances is analyzed. Results are presented at three levels of technical certainty, ranging from technologies already in use to technologies facing technical constraints (such as emissions control problems) which might inhibit widespread use. A fleet-aggregate, engineering-economic analysis is used to estimate a range of U.S. new car fleet average fuel economy levels achievable given roughly 10 years of lead time. Technology cost estimates are compared to fuel savings in order to determine likely cost-effective levels of fuel economy, which are found to range from 39 miles per gallon to 51 miles per gallon depending on technology certainty level. The corresponding estimated increases in average new car price range from $540 to $790 (1993$). Estimated fuel savings payback times average less than 3 years and the cost of conserved energy averages $0.50 per gallon, indicating that these levels of fuel economy improvement are cost-effective over a vehicle lifetime. A vehicle stock turnover model is used to project the reductions in gasoline consumption and associated emissions that would follow if the estimated fuel economy levels are achieved. Potential trade-offs regarding vehicle performance, safety, and emissions are also discussed.     

Will subsidies drive electric vehicle adoption? Measuring consumer preferences in the U.S. and China

We model consumer preferences for conventional, hybrid electric, plug-in hybrid electric (PHEV), and battery electric (BEV) vehicle technologies in China and the U.S. using data from choice-based conjoint surveys fielded in 2012–2013 in both countries. We find that with the combined bundle of attributes offered by vehicles available today, gasoline vehicles continue in both countries to be most attractive to consumers, and American respondents have significantly lower relative willingness-to-pay for BEV technology than Chinese respondents. While U.S. and Chinese subsidies are similar, favoring vehicles with larger battery packs, differences in consumer preferences lead to different outcomes. Our results suggest that with or without each country’s 2012–2013 subsidies, Chinese consumers are willing to adopt today’s BEVs and mid-range PHEVs at similar rates relative to their respective gasoline counterparts, whereas American consumers prefer low-range PHEVs despite subsidies. This implies potential for earlier BEV adoption in China, given adequate supply. While there are clear national security benefits for adoption of BEVs in China, the local and global social impact is unclear: With higher electricity generation emissions in China, a transition to BEVs may reduce oil consumption at the expense of increased air pollution and/or greenhouse gas emissions. On the other hand, demand from China could increase global incentives for electric vehicle technology development with the potential to reduce emissions in countries where electricity generation is associated with lower emissions.     

Modeling the effects of congestion on fuel economy for advanced power train vehicles

Fuel-speed curves (FSC) are used to account for the aggregate effects of congestion on fuel consumption in transportation scenario analysis. This paper presents plausible FSC for conventional internal combustion engine (ICE) vehicles and for advanced vehicles such as hybrid electric vehicles, fully electric vehicles (EVs), and fuel cell vehicles (FCVs) using a fuel consumption model with transient driving schedules and a set of 145 hypothetical vehicles. The FSC shapes show that advanced power train vehicles are expected to maintain fuel economy (FE) in congestion better than ICE vehicles, and FE can even improve for EV and FCV in freeway congestion. In order to implement these FSC for long-range scenario modeling, a bounded approach is presented which uses a single congestion sensitivity parameter. The results in this paper will assist analysis of the roles that vehicle technology and congestion mitigation can play in reducing fuel consumption and greenhouse gas emissions from motor vehicles.     

Individual characteristics and stated preferences for alternative energy sources and propulsion technologies in vehicles: A discrete choice analysis for Germany

With respect to the German goal of a transition to a lead market for electromobility within a short time period, this paper empirically examines the preferences for alternative energy sources or propulsion technologies in vehicles and particularly for electric vehicles. The data stem from a stated preference discrete choice experiment with 598 potential German car buyers. In order to simulate a realistic future purchase situation, seven vehicle types were incorporated in each of the six choice sets, i.e. hybrid, gas, biofuel, hydrogen, and electric vehicles besides common gasoline and diesel vehicles. The econometric analysis with flexible multinomial probit models reveals that potential car buyers in Germany currently have a low stated preference for electric, hydrogen, and hybrid vehicles. While our paper also discusses the impact of common vehicle attributes such as purchase price or service station availability, it particularly considers the effect of socio-demographic and environmental awareness variables. The estimation results reveal that younger potential car buyers have a higher stated preference for hydrogen and electric vehicles, males have a higher stated choice of hydrogen vehicles, and environmentally aware potential car buyers have a higher stated preference for hydrogen and electric vehicles. These results suggest that common policy instruments such as the promotion of research and development, taxation, or subsidization in the field of electromobility could be supplemented by strategies to increase the social acceptance of alternative vehicle types that are directly oriented to these population groups. Methodologically, our study highlights the importance of the inclusion of taste persistence across the choice sets and a high number of random draws in the Geweke–Hajivassiliou–Keane simulator in the simulated maximum likelihood estimation of the multinomial probit models.     

A technical analysis of model year 2011 US automobile efficiency

This paper investigates the new 2011 automobile fleet to quantify the variation in models’ efficiency and underlying technology attributes. This involves analysis of test data to quantify the aerodynamic, rolling resistance, and powertrain efficiency characteristics of each model, as well as analysis to understand relationships between these and vehicle fuel consumption. The findings indicate that while vehicles are about 14% efficient on average, there is wide variation and direct evidence of dramatically improved powertrain efficiency within existing models. Existing gasoline and diesel models demonstrate improved powertrain efficiency by over 25%, hybrid gasoline-electric powertrains by over 50%, fuel cells by a factor of three, and all-electric by a factor of four as compared to the average 2011 vehicle. Advanced aerodynamic and tire rolling resistance technologies are also in evidence.     

Analysis of telecommuting behavior and impacts on travel demand and the environment

The discussion of whether, and to what extent, telecommuting can curb congestion in urban areas has spanned more than three decades. This study develops an integrated framework to provide the empirical evidence of the potential impacts of home-based telecommuting on travel behavior, network congestion, and air quality. In the first step, we estimate a telecommuting adoption model using a zero-inflated hierarchical ordered probit model to determine the factors associated with workers’ propensity to adopt telecommuting. Second, we implement the estimated model in the POLARIS activity-based framework to simulate the potential changes in workers’ activity-travel patterns and network congestion. Third, the MOVES mobile source emission simulator and Autonomie vehicle energy simulator are used to estimate the potential changes in vehicular emissions and fuel use in the network as a result of this policy. Different policy adoption scenarios are then tested in the proposed integrated platform. We found that compared to the current baseline situation where almost 12% of workers in Chicago region have flexible working time schedule, in the case when 50% of workers have flexible working time, telecommuting can reduce total daily vehicle miles traveled (VMT) and vehicle hours traveled (VHT) up to 0.69% and 2.09%, respectively. Considering the same comparison settings, this policy has the potential to reduce greenhouse gas and particulate matter emissions by up to 0.71% and 1.14%, respectively. In summary, our results endorse the fact that telecommuting policy has the potential to reduce network congestion and vehicular emissions specifically during rush hours.     

The role of alternative fuel vehicles: Using behavioral and sensor data to model hierarchies in travel

Greater adoption and use of alternative fuel vehicles (AFVs) can be environmentally beneficial and reduce dependence on gasoline. The use of AFVs vis-à-vis conventional gasoline vehicles is not well understood, especially when it comes to travel choices and short-term driving decisions. Using data that contains a sufficiently large number of early AFV adopters (who have overcome obstacles to adoption), this study explores differences in use of AFVs and conventional gasoline vehicles (and hybrid vehicles). The study analyzes large-scale behavioral data integrated with sensor data from global positioning system devices, representing advances in large-scale data analytics. Specifically, it makes sense of data containing 54,043,889 s of speed observations, and 65,652 trips made by 2908 drivers in 5 regions of California. The study answers important research questions about AFV use patterns (e.g., trip frequency and daily vehicle miles traveled) and driving practices. Driving volatility, as one measure of driving practice, is used as a key metric in this study to capture acceleration, and vehicular jerk decisions that exceed certain thresholds during a trip. The results show that AFVs cannot be viewed as monolithic; there are important differences within AFV use, i.e., between plug-in hybrids, battery electric, or compressed natural gas vehicles. Multi-level models are particularly appropriate for analysis, given that the data are nested, i.e., multiple trips are made by different drivers who reside in various regions. Using such models, the study also found that driving volatility varies significantly between trips, driver groups, and regions in California. Some alternative fuel vehicles are associated with calmer driving compared with conventional vehicles. The implications of the results for safety, informed consumer choices and large-scale data analytics are discussed.     

A structural analysis of vehicle design responses to Corporate Average Fuel Economy policy

The US Corporate Average Fuel Economy (CAFE) regulations are intended to influence automaker vehicle design and pricing choices. CAFE policy has been in effect for the past three decades, and new legislation has raised standards significantly. We present a structural analysis of automaker responses to generic CAFE policies. We depart from prior CAFE analyses by focusing on vehicle design responses in long-run oligopolistic equilibrium, and we view vehicles as differentiated products, taking demand as a general function of price and product attributes. We find that under general cost, demand, and performance functions, single-product profit maximizing firm responses to CAFE standards follow a distinct pattern: firms ignore CAFE when the standard is low, treat CAFE as a vehicle design constraint for moderate standards, and violate CAFE when the standard is high. Further, the point and extent of first violation depends upon the penalty for violation, and the corresponding vehicle design is independent of further standard increases. Thus, increasing CAFE standards will eventually have no further impact on vehicle design if the penalty for violation is also not increased. We implement a case study by incorporating vehicle physics simulation, vehicle manufacturing and technology cost models, and a mixed logit demand model to examine equilibrium powertrain design and price decisions for a fixed vehicle body. Results indicate that equilibrium vehicle design is not bound by current CAFE standards, and vehicle design decisions are directly determined by market competition and consumer preferences. We find that with increased fuel economy standards, a higher violation penalty than the current stagnant penalty is needed to cause firms to increase their design fuel economy at equilibrium. However, the maximum attainable improvement can be modest even if the penalty is doubled. We also find that firms’ design responses are more sensitive to variation in fuel prices than to CAFE standards, within the examined ranges.     

Incentivizing alternative fuel vehicles: the influence of transport policies,attitudes and perceptions

This paper aims to evaluate the influence of policies, attitudes and perceptions when incentivizing alternative fuel vehicles. The impact of possible policies such as gasoline taxes increases, purchase price subsidies, tax exemptions, and increases in fuel recharging station availability for alternative fuelled vehicles is evaluated using hybrid choice models. The models also allow assessing the sensitivity of latent variables (i.e., attitudes and perceptions) in the car purchase behaviour. The models are estimated using data from a stated choice survey collected in five Colombian cities. The latent variables are obtained from the rating of statements related to the transport system, environmental concern, vehicle preferences, and technology. The modelling approach includes regression between latent variables. Results show that environmental concern and the support for green transport policies have a positive influence on the intention to purchase alternative fuel vehicles. Meanwhile, people who reveal to be car-dependent prefer to buy standard fuelled vehicles. The analysis among cities shows similar trends in individual behaviour, although there are differences in attribute sensitivities. The policy scenario analysis revealed high sensitivity to capital cost and the need for extensive investments in refuelling stations for alternative fuel vehicles to become attractive. Nevertheless, all policies should not only be directed at infrastructure and vehicles but also be focused on user awareness and acceptance of the alternative fuel vehicles. The analysis suggests that in an environmentally conscious market, people prefer alternative fuels. However, if the transport policies support private transport, the market shares of alternative fuel vehicles will decrease.     

Does winter road maintenance help reduce air emissions and fuel consumption?

Winter road maintenance (WRM) has been shown to have significant benefits of improving road safety and reducing traffic delay caused by adverse weather conditions. It has also been suggested that WRM is also beneficial in terms of reducing vehicular air emissions and fuel consumptions because snow and ice on road surface often cause the drivers to reduce their vehicle speeds or to switch to high gears, thus decreasing fuel combustion efficiency. However, there has been very limited information about the underlying relationship, which is important for quantifying this particular benefit of a winter road maintenance program. This research is focused on establishing a quantitative relationship between winter road surface conditions and vehicular air emissions. Speed distribution models are developed for the selected Ontario highways using data from 22 road sites across the province of Ontario, Canada. The vehicular air emissions under different road surface conditions are calculated by coupling the speed models with the engine emission models integrated in the emission estimation model - MOVES. It was found that, on the average, a 10% improvement in road surface conditions could result in approximately 0.6–2% reduction in air emissions. Application of the proposed methodology is demonstrated through a case study to analyse the air emission and energy consumption effects under specific weather events.     

Investigation of tailpipe and evaporative emissions from China IV and Tier 2 passenger vehicles with different gasolines

The limited understanding of vehicular emissions in China, especially evaporative emissions, is one obstacle to establishing tighter standards. To evaluate tailpipe and evaporative emissions, two typical China IV vehicles and one Tier 2 vehicle with an onboard refuelling vapour recovery (ORVR) system were selected and tested. One of the China IV vehicles was fuelled with gasoline, E10 and M15, respectively, to investigate the effect of fuel properties on vehicular emissions. For each vehicle, cold-start tailpipe emission tests were conducted first, followed by an evaporation test. Based on the emission factors and real-world vehicle activity data, the annual tailpipe and evaporative hydrocarbon (HC) emissions of each vehicle were calculated and compared. The results show that E10 and M15 significantly reduced the tailpipe CO and particle number (PN) emissions but seriously aggravated the NOx emissions, especially for M15. The hot soak losses (HSLs) and diurnal breathing losses (DBLs) were slightly impacted by the fuel properties. The annual evaporative emissions with E10 and M15 were higher than that with gasoline. The ORVR system effectively controlled the evaporative emissions, especially for DBLs. Evaporative emissions from the China IV vehicles were 1.1–1.4 times the tailpipe HC emissions. Additionally, the evaporative emission factors of the China IV vehicles were almost 50% lower than the standard (2.0 g/test), whereas their annual evaporative emissions were almost 1.8–2.8 times higher than those from the Tier 2 vehicle. Therefore, controlling evaporative emissions currently remains a great need in China, and the ORVR might be a recommended evaporative control technology.