A dynamic marketing model for hybrid electric vehicles: A case study of Taiwan

This study uses an integrated model utilizing a small-world network and choice-based conjoint adoption model to examine the dynamics of consumer choice and diffusion in the hybrid electric vehicles market. It specifically compares the effectiveness of hybrid diffusion through the traditional word of mouth and via social media. The results show that without the advantage of increased gasoline prices, the growth of the hybrid vehicles market is insignificant, and that the Internet has a significant influence on the word of mouth effect in the purchasing process. Hybrid electric vehicles market shares decrease dramatically as a result of negative word of mouth communication via social media. The use of a higher fuel taxes is more effective than providing a subsidy for disposing of old vehicles and purchasing a hybrid.     

Expanding scope of hybrid choice models allowing for mixture of social influences and latent attitudes: Application to intended purchase of electric cars

Recently, policy makers’ expectations about the role of electric cars in reducing emissions have risen substantially. In parallel, academic research on purchase intentions has dramatically increased. Originally, most studies have focused on utility attributes and price. More recently, several hybrid choice models have been estimated to include the impact of attitudes on choice probabilities. In addition, a few studies have caught the attention to social influence. In contributing to this line of research, this paper reports the results of an expanded hybrid choice, which simultaneously estimated all these different effects in a single integrated model of purchase intention. Results indicate that the model performs well. Costs considerations contribute most to the utility of electric cars. Social influence is less important, but there is also evidence that people tend to take it into consideration when there are positive public opinions about electric cars and the market share becomes almost half of friends of their social network. The intention to purchase an electric car is also influenced by attitudes about environmental concerns and technology acceptance.     

Consumer preferences for battery electric vehicles: A choice experimental survey in China

To accelerate the diffusion of battery electric vehicles (BEVs), consumer preferences for different products and policy attributes must be determined. Although previous studies have investigated consumer preferences for some product attributes, including purchase price, operation cost, driving range, and charging time, limited studies have discussed the broader aspects of product attributes, such as battery warranty and depreciation rate. Moreover, market-oriented incentives, including the personal carbon trading (PCT) scheme and the tradable driving credits (TDC) scheme, can theoretically be effective alternatives to expensive purchase subsidies. However, there is a lack of empirical evidence that confirms the influence of these two schemes on BEV adoption. To fill these gaps, we conducted a stated preference choice experimental survey in China and investigated the effect of product attributes, existing policy incentives, and two emerging market-oriented incentives on BEV adoption. Our results reveal that along with the main product attributes, battery warranty has a significant positive effect on inducing mainstream consumers to adopt BEVs while no preference difference occurs among existing policy incentives after purchase subsidies are abolished. For young consumers, almost all incentives that reduce the operation cost (e.g., PCT) or increase convenience (e.g., TDC) can increase their adoption of BEVs. These findings can provide important implications for the government with regard to designing novel incentives and promoting BEV adoption.     

The effects of social networks on choice set dynamics: Results of numerical simulations using an agent-based approach

Activity-based analysis has slowly shifted gear from the analysis of daily activity patterns to the analysis and modeling of dynamic activity-travel patterns. In this paper, we address one type of dynamics: the formation and adaptation of location choice sets under influence of dyad relationships within social networks. It extends the dynamic model developed in earlier work, which simulates habitual behavior versus exploitation and exploration as a function of discrepancies between dynamic, context-dependent aspiration levels and expected outcomes. Principles of social comparison and knowledge transfer are used in modeling the impact of social networks through information exchange, adaptations of spatial choice sets and formation of common aspiration levels. We demonstrate model properties using numerical simulation with a case study of shopping activities.     

A discrete choice framework for modeling and forecasting the adoption and diffusion of new transportation services

Major technological and infrastructural changes over the next decades, such as the introduction of autonomous vehicles, implementation of mileage-based fees, carsharing and ridesharing are expected to have a profound impact on lifestyles and travel behavior. Current travel demand models are unable to predict long-range trends in travel behavior as they do not entail a mechanism that projects membership and market share of new modes of transport (Uber, Lyft, etc.). We propose integrating discrete choice and technology adoption models to address the aforementioned issue. In order to do so, we build on the formulation of discrete mixture models and specifically Latent Class Choice Models (LCCMs), which were integrated with a network effect model. The network effect model quantifies the impact of the spatial/network effect of the new technology on the utility of adoption. We adopted a confirmatory approach to estimating our dynamic LCCM based on findings from the technology diffusion literature that focus on defining two distinct types of adopters: innovator/early adopters and imitators. LCCMs allow for heterogeneity in the utility of adoption for the various market segments i.e. innovators/early adopters, imitators and non-adopters. We make use of revealed preference (RP) time series data from a one-way carsharing system in a major city in the United States to estimate model parameters. The data entails a complete set of member enrollment for the carsharing service for a time period of 2.5 years after being launched. Consistent with the technology diffusion literature, our model identifies three latent classes whose utility of adoption have a well-defined set of preferences that are significant and behaviorally consistent. The technology adoption model predicts the probability that a certain individual will adopt the service at a certain time period, and is explained by social influences, network effect, socio-demographics and level-of-service attributes. Finally, the model was calibrated and then used to forecast adoption of the carsharing system for potential investment strategy scenarios. A couple of takeaways from the adoption forecasts were: (1) placing a new station/pod for the carsharing system outside a major technology firm induces the highest expected increase in the monthly number of adopters; and (2) no significant difference in the expected number of monthly adopters for the downtown region will exist between having a station or on-street parking.     

Investigating heterogeneity in social influence by social distance in car-sharing decisions under uncertainty: A regret-minimizing hybrid choice model framework based on sequential stated adaptation experiments

The present study is designed to investigate social influence in car-sharing decisions under uncertainty. Social influence indicates that individuals’ decisions are influenced by the choices made by members of their social networks. An individual may experience different degrees of influence depending on social distance, i.e. the strength of the social relationship between individuals. Such heterogeneity in social influence has been largely ignored in the previous travel behavior research. The data used in this study stems from an egocentric social network survey, which measures the strength of the social relationships of each respondent. In addition, a sequential stated adaptation experiment was developed to capture more explicitly the effect of social network choices on the individual decision-making process. Social distance is regarded as a random latent variable. The estimated social distance and social network choices are incorporated into a social influence variable, which is treated as an explanatory variable in the car-sharing decision model. To simultaneously estimate latent social distance and the effects of social influence on the car-sharing decision, we expand the hybrid choice framework to incorporate the latent social distance model into discrete choice analysis. The estimation results show substantial social influence in car-sharing decisions. The magnitude of social influence varies according to the type of relationship, similarity of socio-demographics and the number of social interactions.     

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.     

Impact of vehicle usage on consumer choice of hybrid electric vehicles

We analyze the vehicle usage and consumer profile attributes extracted from both National Household Travel Survey and Vehicle Quality Survey data to understand the impact of vehicle usage upon consumers’ choices of hybrid electric vehicles in the US. In addition, the key characteristics of hybrid vehicle drivers are identified to determine the market segmentations of hybrid electric vehicles and the critical attributes to include in the choice model. After a compatibility test of two datasets, a pooled choice model combining both data sources illustrates the significant influences of vehicle usage upon consumers’ choices of hybrid electric vehicles. Even though the data-bases have in the past been used independently to study travel behavior and vehicle quality ratings, here we use them together.     

Willingness-to-pay for alternative fuel vehicle characteristics: A stated choice study for Germany

In the light of European energy efficiency and clean air regulations, as well as an ambitious electric mobility goal of the German government, we examine consumer preferences for alternative fuel vehicles (AFVs) based on a Germany-wide discrete choice experiment among 711 potential car buyers. We estimate consumers’ willingness-to-pay and compensating variation (CV) for improvements in vehicle attributes, also taking taste differences in the population into account by applying a latent class model with 6 distinct consumer segments. Our results indicate that about 1/3 of the consumers are oriented towards at least one AFV option, with almost half of them being AFV-affine, showing a high probability of choosing AFVs despite their current shortcomings. Our results suggest that German car buyers’ willingness-to-pay for improvements of the various vehicle attributes varies considerably across consumer groups and that the vehicle features have to meet some minimum requirements for considering AFVs. The CV values show that decision-makers in the administration and industry should focus on the most promising consumer group of ‘AFV aficionados’ and their needs. It also shows that some vehicle attribute improvements could increase the demand for AFVs cost-effectively, and that consumers would accept surcharges for some vehicle attributes at a level which could enable their private provision and economic operation (e.g. fast-charging infrastructure). Improvement of other attributes will need governmental subsidies to compensate for insufficient consumer valuation (e.g. battery capacity).     

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.     

Exploring the propensity to perform social activities: a social network approach

Conceptual and empirical models of the propensity to perform social activity–travel behavior are described, which incorporate the influence of individuals’ social context, namely their social networks. More explicitly, the conceptual model develops the concepts of egocentric social networks, social activities, and social episodes, and defines the three sets of aspects that influence the propensity to perform social activities: individuals’ personal attributes, social network composition, and information and communication technology interaction with social network members. Using the structural equation modeling (SEM) technique and data recently collected in Toronto, the empirical model tests the effect of these three aspects on the propensity to perform social activities. Results suggest that the social networks framework provides useful insights into the role of physical space, social activity types, communication and information technology use, and the importance of “with whom” the activity was performed with. Overall, explicitly incorporating social networks into the activity–travel behavior modeling framework provides a promising framework to understand social activities and key aspects of the underlying behavioral process. Juan Antonio Carrasco a PhD candidate in Civil Engineering at the University of Toronto, holds a MSc degree in Transportation Engineering from the Pontificia Universidad Católica de Chile. His doctoral research explores the relationships between social networks, activity–travel behavior, and ICTs. His research interests also include microsimulation, land use-transportation, and econometric modeling. Eric J. Miller is Bahen-Tanenbaum Professor of Civil Engineering at the University of Toronto where he is also Director of the Joint Program in Transportation. His research interests include integrated land-use/transportation modeling, activity-based travel modeling, microsimulation and sustainable transportation planning.     

Inclusion of latent variables in Mixed Logit models: Modelling and forecasting

Travel demand models typically use mainly objective modal attributes as explanatory variables. Nevertheless, it has been well known for many years that attitudes and perceptions also influence users’ behaviour. The use of hybrid discrete choice models constitutes a good alternative to incorporate the effect of subjective factors. We estimated hybrid models in a short-survey panel context for data among many alternatives. The paper analyses the results of applying these models to a real urban case study, and also proposes an approach to forecasting using these models. Our results show that hybrid models are clearly superior to even highly flexible traditional models that ignore the effect of subjective attitudes and perceptions.     

Inference on mode preferences,vehicle purchases,and the energy paradox using a Bayesian structural choice model

Discrete choice modeling is experiencing a reemergence of research interest in the inclusion of latent variables as explanatory variables of consumer behavior. There are several reasons that motivate the integration of latent attributes, including better-informed modeling of random consumer heterogeneity and treatment of endogeneity. However, current work still is at an early stage and multiple simplifying assumptions are usually imposed. For instance, most previous applications assume all of the following: independence of taste shocks and of latent attributes, exclusion restrictions, linearity of the effect of the latent attributes on the utility function, continuous manifest variables, and an a priori bound for the number of latent constructs. We derive and apply a structural choice model with a multinomial probit kernel and discrete effect indicators to analyze continuous latent segments of travel behavior, including inference on the energy paradox. Our estimator allows for interaction and simultaneity among the latent attributes, residual correlation, nonlinear effects on the utility function, flexible substitution patterns, and temporal correlation within responses of the same individual. Statistical properties of the Bayes estimator that we propose are exact and are not affected by the number of latent attributes.     

Why early adopters engage in interpersonal diffusion of technological innovations: An empirical study on electric bicycles and electric scooters

Early adopters promoting electric vehicles in their social network may speed up market uptake of this technology. Apart from their opinion leader status, few previous research details the motivations which turn early adopters into advocates for innovation who approach the non-adopters among their family and friends, or casual acquaintances.Drawing on a survey among 1398 e-bike and 133 e-scooter early adopters in Austria, personal drivers of engagement in interpersonal diffusion are investigated. Longitudinal data one year later for 157 e-bike users allows tests of causal relations. A complementary sample of 33 network peers illustrates the early adopters’ social impact.Early adopters engage actively in discussing product features, instigating trial behavior and recommending purchase. Analyses by structural equation modeling show that efforts at interpersonal diffusion are driven by opinion leadership, experienced product performance, and perceived normative expectations of others toward pro-environmental technologies. Mediator and moderator analyses underline that opinion leadership is conveyed upon early adopters because personal norms and technophilia qualify them as credible and competent for the specific topic of e-vehicles. Social norm interrelations point to dynamic interactions and discourse between early adopters and their addressees. Evidence from the peer sample suggests though that the persuasive impact of early adopters is small.To accelerate market entry of electric vehicles, public or private agencies should foremost approach early adopters scoring high in the identified drivers, and empower them in their role as multiplicators by providing pre-prepared product information and encouraging them to continuously address peers.     

Optimization of incentive polices for plug-in electric vehicles

High purchase prices and the lack of supporting infrastructure are major hurdles to the adoption of plug-in electric vehicles (PEVs). It is widely recognized that the government could help break these barriers through incentive policies, such as offering rebates to PEV buyers or funding charging stations. The objective of this paper is to propose a modeling framework that can optimize the design of such incentive policies. The proposed model characterizes the impact of the incentives on the dynamic evolution of PEV market penetration over a discrete set of time intervals, by integrating a simplified consumer vehicle choice model and a macroscopic travel and charging model. The optimization problem is formulated as a nonlinear and non-convex mathematical program and solved by a specialized steepest descent direction algorithm. We show that, under mild regularity conditions, the KKT conditions of the proposed model are necessary for local optimum. Results of numerical experiments indicate that the proposed algorithm is able to obtain satisfactory local optimal policies quickly. These optimal policies consistently outperform the alternative policies that mimic the state-of-the-practice by a large margin, in terms of both the total savings in social costs and the market share of PEVs. Importantly, the optimal policy always sets the investment priority on building charging stations. In contrast, providing purchase rebates, which is widely used in current practice, is found to be less effective.     

Traffic accident risk perception among drivers: a latent variable approach

ABSTRACT

Governments require decision tools to deal with road traffic accidents, a pandemic resulting in millions of deaths around the world. Evidence shows that human factors are one of the major causes of road accidents, and there is much interest in identifying variables that may have an impact on drivers’ perception of risk. To this aim, we design a stated choice experiment with eight hypothetical driving scenarios considering attributes that have been strongly associated with increased accident risks: (i) driving speed, (ii) driving the wrong way in a one-way street, (iii) overtaking on a bend, and (iv) driving under the influence of alcohol or drugs. Data from a sample of survey respondents are used to estimate a hybrid discrete choice model incorporating two latent variables, Driver Concentration and Safe Driving. Our results may contribute to the design of public policies geared to prevent accidents by encouraging safer driving behaviour.     

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.     

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.     

Predicting the adoption of connected autonomous vehicles: A new approach based on the theory of diffusion of innovations

On the grounds that individuals heavily rely on the information that they receive from their peers when evaluating adoption of a radical innovation, this paper proposes a new approach to forecast long-term adoption of connected autonomous vehicles (CAVs). The concept of resistance is employed to explain why individuals typically tend to defer the adoption of an innovation. We assume that there exists a social network among individuals through which they communicate based on certain frequencies. In addition, individuals can be subject to media advertisement based on certain frequencies. An individual’s perceptions are dynamic and change over time as the individual is exposed to advertisement and communicates with satisfied and dissatisfied adopters. We also explicitly allow willingness-to-pay (WTP) to change as a result of peer-to-peer communication. An individual decides to adopt when (i) there is a need for a new vehicles; (ii) his/her WTP is greater than CAV price; and (iii) his/her overall impression about CAVs reaches a cutoff value. Applicability of the proposed approach is shown using a survey of employees of the University of Memphis. Our results show that the automobile fleet will be near homogenous in about 2050 only if CAV prices decrease at an annual rate of 15% or 20%. We find that a 6-month pre-introduction marketing campaign may have no significant impact on adoption trend. Marketing is shown to ignite CAV diffusion but its effect is capped. CAV market share will be close to 100% only if all adopters are satisfied with their purchases; therefore, the probability that an individual becomes a satisfied adopter plays an important role in the trend of adoption. The effect of the latter probability is more pronounced as time goes by and is also more prominent when CAV price reduces at greater rates. Some caveats may be inserted when considering the study results as the findings are subject to sample bias and data limitations.     

Exploring the links between personal networks, time use, and the spatial distribution of social contacts

Although the study of the role of the social context in travel behavior and activity patterns has recently gained attention, the empirical evidence supporting the relationship between social networks and the temporal and spatial characteristics of social activities is still limited. With this motivation, this paper studies the link between “longer term” (social networks) and “shorter term” (social activities) social decisions, by exploring the intertwined relationship between the individuals’ personal networks attributes, and the spatiotemporal characteristics of their daily social activities. The paper contributes to the literature by adding two key aspects to the study of the role of social networks on travel behavior: the social networks’ structure, and the spatiality of all individuals participating on the social activities. Based on data which link people’s personal networks and time use, and using a structural equation modeling approach, the paper studies the influence of individual and interactional attributes on the duration, distance, and number of people involved in social daily activities. The results show that aspects such as tie social closeness, gender and age similarity, and network density, help to understand social activity duration and distance, complementing traditional socio-demographic aspects such as income, occupation, and accessibility to services. In this way, socio-demographic attributes are not enough to explain the spatiotemporal dimension of daily activities which makes necessary to include variables related to the social context to explain with a higher level of accuracy both the duration and distance traveled to the activity.