Consumer intentions for alternative fuelled and autonomous vehicles: A segmentation analysis across six countries

Rapid advances in the development of autonomous and alternative-fuel vehicles (AFVs) are likely to transform the future of mobility and could bring benefits such as improved road safety and lower emissions. Achieving these potential benefits requires widespread consumer support for these disruptive technologies. To date, research to explore consumer perceptions of transport innovations has tended to consider them in isolation (e.g., driverless cars, electric vehicles). The current paper examines the predictors of consumer interest in and willing to pay for both AFVs and autonomous vehicles through a choice experiment conducted in six diverse markets: Germany, India, Japan, Sweden, UK and US. Using Latent Class Discrete Choice Models, we observe significant heterogeneity both within and across the country samples. For example, while Japanese consumers are generally willing to pay for autonomous vehicles, in most European countries, consumers need to be compensated for automation. Within countries, though, we found some segments – typically, those with a university degree, and self-identifying as having a pro-environmental identity and as being innovators– are more in favour of automation. Significantly, we also found that support for autonomous vehicles is associated with support for AFVs, perhaps, due to common demographic or socio-psychological predictors of both types of innovative technology. These findings are valuable for policymakers and the automotive industry in identifying potential early adopters, as well as consumer segments or cultures less convinced to adopt these innovative transport technologies.     

The impact of fuel availability on demand for alternative-fuel vehicles

We study the impact of fuel availability on demand for alternative-fuel vehicles, using data from a survey of potential car buyers in Germany. The survey was conducted as a computer-assisted personal interview and included a choice experiment involving cars with various fuel types. Applying a standard logit model, we show that alternative fuel availability influences choices positively, but its marginal utility diminishes with supply. Furthermore, we derive consumers’ marginal willingness-to-pay for an expanded service station network. The results suggest that a failure to expand the availability of alternative fuel stations represents a significant barrier to the widespread adoption of alternative-fuel vehicles.     

The Alternative Motor Fuels Act, alternative-fuel vehicles, and greenhouse gas emissions

The corporate average fuel economy (CAFE) standard is the major policy tool to improve the fleet average miles per gallon of automobile manufacturers in the US. The Alternative Motor Fuels Act (AMFA) provides special treatment in calculating the fuel economy of alternative-fuel vehicles to give manufacturers CAFE incentives to produce more alternative-fuel vehicles. AMFA has as its goals an increase in the production of alternative-fuel vehicles and a decrease in gasoline consumption and greenhouse gas emissions. This paper examines theoretically the effects of the program set up under AMFA. It finds that, under some conditions, this program may actually increase the production of fuel-inefficient gasoline vehicles, gasoline consumption and greenhouse gas emissions.     

The effect of attitudes on reference-dependent preferences: Estimation and validation for the case of alternative-fuel vehicles

Several recent studies in transportation have analysed how choices made by individuals are influenced by attitudes. Other studies have contributed to our understanding of apparently non-rational behaviour by examining how choices may reflect reference-dependent preferences. This paper examines how reference-dependent preferences and attitudes together may explain individual choices. In a modelling framework based on a hybrid choice model allowing for both concepts, we investigate how attitudes and reference-dependent preferences interact and how they affect willingness-to-pay measures and demand elasticities. Using a data set with stated choices among alternative-fuel vehicles, we see that allowing for reference-dependent preferences improves our ability to explain the stated choices in the data and that the attitude (appreciation of car features) explains part of the preference heterogeneity across individuals. The results indicate that individuals have reference-dependent preferences that could be explained by loss aversion and that these are indeed related to an individual’s attitude towards car features. The models are validated using a large hold-out sample. This shows that the inclusion of attitudes improves the models’ ability to explain behaviour in the hold-out sample. While neither reference-dependent preferences nor the attitude affect the average willingness-to-pay measures in our sample, their effect on choice behaviour has implications for policy recommendations as segments with varying attitudes and reference values will act differently when affected by policy instruments related to the demand for alternative-fuel vehicles, e.g. subsidies.     

A hedonic test of the effects of the Alternative Motor Fuels Act

Under the Alternative Motor Fuels Act (AMFA), vehicles that run on ethanol, methanol, or natural gas get extra credits in the calculation of Corporate Average Fuel Economy (CAFE). This paper uses hedonic techniques to examine the effect of production of alternative-fuel vehicles (AFVs) on the implicit price of fuel economy. This study finds that, after AFVs came to market, the marginal value of fuel economy from companies producing them decreased. This finding suggests that manufacturers who produced AFVs were willing to offer a lower price for fuel economy, because automakers had an additional way to achieve fuel economy standards beyond improving the fuel efficiency of conventional cars. These findings bolster the argument that a major role of the AMFA credit for AFVs is to allow automakers to increase their production of fuel-inefficient vehicles.     

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.     

Impact of electric vehicles on existing car usage: A mixed multiple discrete–continuous extreme value model approach

This study investigates how the introduction of electric vehicles may influence the usage of existing cars. A survey of 250 households in South Korea is used to analyze a future automobile market that includes electric vehicles taking into account the heterogeneity of consumer preferences and usage patterns. Based on consumer preferences, the future market share of various vehicles is estimated and the impact of promoting the usage of electric vehicles by government subsidization and tax incentives is analyzed.     

Determinants of new vehicle registrations in EU countries: a panel cointegration analysis

This paper investigates the determinants of new vehicle registrations in European Union (EU) countries by focusing on four particular segments – passenger cars, light commercial vehicles, commercial vehicles, and heavy commercial vehicles. A panel cointegration analysis for a panel of 13 EU countries during the period from January 1999 to August 2010 shows that new vehicle sales have long-run cointegration relations with vehicle prices, consumer confidence, income, interest rates, fuel prices, industrial production, and trade. More effective factors in determining new vehicle sales appear to be trade, interest rates, and industrial production.     

Incorporating social impact on new product adoption in choice modeling: A case study in green vehicles

While discrete choice analysis is prevalent in capturing consumer preferences and describing their choice behaviors in product design, the traditional choice modeling approach assumes that each individual makes independent decisions, without considering the social impact. However, empirical studies show that choice is social – influenced by many factors beyond engineering performance of a product and consumer attributes. To alleviate this limitation, we propose a new choice modeling framework to capture the dynamic influence from social networks on consumer adoption of new products. By introducing social influence attributes into a choice utility function, social network simulation is integrated with the traditional discrete choice analysis in a three-stage process. Our study shows the need for considering social impact in forecasting new product adoption. Using hybrid electric vehicles as an example, our work illustrates the procedure of social network construction, social influence evaluation, and choice model estimation based on data from the National Household Travel Survey. Our study also demonstrates several interesting findings on the dynamic nature of new technology adoption and how social networks may influence hybrid electric vehicle adoption.     

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 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.     

Factors affecting consumer assessment of eco-labeled vehicles

A statewide sample of Maine registered vehicle owners is used to examine factors that affect their assessments of eco-labeled conventionally fueled passenger vehicles. The study focuses on developing an empirical and theoretical framework with which to model vehicle choice decisions under eco-labeled conditions. Particular attention is paid to how eco-information may affect the two-stage vehicle purchase process. The study builds upon environmental economic and psychology literature in examining the role of personal characteristics such as perceived effectiveness of consumer purchase decisions and perceptions of the eco-labeled products as factors in the vehicle purchase decision. It was found that environmental attributes of an eco-labeled passenger vehicle are significant in the purchase decision. The eco-information is considered in the vehicle purchase decision, but is generally not considered at the class-level decision.     

Estimating daily vehicle usage distributions and the implications for limited-range vehicles

Understanding the potential market for limited-range vehicles is important to planning research and development programs for electric and hybrid vehicles and for gaseous-fueled vehicles as well. Studies of consumer preferences and perceptions have shown vehicle range to be a very important vehicle attribute. Studies of household vehicle use, on the other hand, have suggested that the range requirements most households place on vehicles are quite modest. The latter, however, have been severely limited by the absence of longitudinal data on the usage of individual vehicles. Instead, they have relied on single-day surveys on many vehicles, an inappropriate data source. This study develops a method for estimating daily travel distributions for individual vehicles and applies it to a recent longitudinal survey of miles and days between refuelings for over 2000 vehicles. Every vehicle in the sample has at least 30 consecutive refueling intervals. A variety of measures of “range requirement” are defined and calculated. The results confirm the existence of a substantial potential market (20–50% of all household vehicles) for vehicles with ranges on the order of 100 miles. Future research using these data and this method could describe the nature of vehicles with limited-range needs and the households which own them.     

A statistical analysis of consumer perceptions towards automated vehicles and their intended adoption

ABSTRACT

While automated vehicle (AV) development continues to progress rapidly, how the public will accept and adopt automated vehicles remains an open question. Using extensive survey data, we apply cluster analysis to better understand consumer perceptions toward potential benefits and concerns related to AVs with regard to factors influencing their AV adoption likelihood. Four market segments are identified – ‘benefits-dominated,’ ‘concerns-dominated,’ ‘uncertain,’ and ‘well-informed.’ A random parameters multinomial logit model is then estimated to identify factors influencing the probability of respondents belonging to one of these four market segments. Among other influences (such as socio-economic and current travel characteristics), it is found that ‘Millennials’ have a higher probability of belonging to the well-informed market segment, ‘Gen-Xers’ with a lower probability to the uncertain market segment, and ‘Baby Boomers’ with a higher probability to the concerns-dominated market (relative to the ‘Great Generation’). We also study the individuals’ expressed likelihood of AV adoption using separate random parameters ordered probit estimations for each of the four market segments. The substantial and statistically significant differences across each AV consumer market segment underscore the potentially large impact that different consumer demographics may have on AV adoption and the need for targeted marketing to achieve better market-penetration outcomes.     

Demand forecasting of diesel passenger car considering consumer preference and government regulation in South Korea

Changing market regulations in South Korea have allowed diesel-fueled passenger cars in the domestic market. The diffusion of diesel cars is tied to issues of environmental impact, energy supply and demand, and changes in tax revenue. Policymakers can influence demand for diesel vehicles to protect social welfare and to observe international environmental protection laws. On the supply side, carmakers need to know consumer preferences regarding new vehicles to arrive at development strategies.This study uses microsimulated demand forecasting to address these issues and predict consumer demand for diesel passenger cars. The model accommodates governmental policies and car attributes such as price and engine efficiency. We find that consumers will likely prefer diesel passenger cars to gasoline ones due to the low operation costs of the former in spite of high purchase price when diesel is relatively cheaper than gasoline. Finally we find that diesel passenger cars will capture a 42% market penetration ratio under the pricing system suggested by the Ministry of Environment of Korea.     

Intent to purchase a plug-in electric vehicle: A survey of early impressions in large US cites

This paper examines consumer stated intent to purchase plug-in electric vehicles and assesses the factors that increase or decrease interest. We surveyed adult drivers in large US cities in early fall 2011, before vehicle manufacturers and dealers began marketing campaigns. The survey responses thus document early impressions of this transport technology. We find that, given current battery technology and public perceptions, overall stated intent to purchase or lease electric vehicles is low. Interest in plug-in hybrid technology is somewhat greater than interest in all-electric technology. Consumers who express early interest in adopting electric vehicles are typically highly educated, previous owners of conventional hybrids, environmentally sensitive, and concerned about dependence on foreign oil. Enhanced fuel economy, the primary tangible advantage of plug-in technology, is recognized as favorable by respondents but fails to exert a strong influence on purchasing intentions. Interest in plug-in electric vehicles is shaped primarily by consumers’ perceptions of electric vehicle disadvantages.     

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.     

Forecasting automobile demand using disaggregate choice models

This paper presents a simulation model of the American automobile market. The simulation model combines a disaggregate model of household automobile number and type choice with an econometric model of used vehicle scrappage and simple models of new car supply. For fixed vehicle designs, consumer and producer interactions determine new car sales, used car scrappage and consumer vehicle holdings. The model allows automobiles to be highly differentiated and consumers to be heterogeneous. Short-run equilibrium is defined as supply equal to demand for every vehicle type during each market period. The automobile stock then evolves slowly as new vehicles are added and old vehicles are removed during each period. An empirical application of the simulation model with 12 consumer groups and 131 vehicle types is used to forecast automobile holdings. A base case scenario is run for 1978–1984 and compared with the observed market behavior during this period. Several other simulations are then run comparing different gasoline price scenarios with the base case for 1984–1990.     

Consumer valuation of changes in driving range: A meta-analysis

We perform a meta-analysis of studies investigating consumer preferences for electric and other alternative fuel vehicles (AFVs) to provide insights into the way driving range is traded off for capital costs. We find that consumers are willing to pay, on average, between 66 and 75 US$ for a 1-mile increase in driving range. Ceteris paribus, 100-mile-range cars have to be priced about 60% less than their conventional counterparts to become competitive. In line with intuition, but in contrast to most specifications employed in primary studies, we find that consumers’ marginal willingness to pay (WTP) decreases at a diminishing rate with increases in driving range. The variation in the WTP and compensating variation estimates among examined studies can be attributed to differences in the levels of driving range considered, in other elements of the study design and in the country of study. Our findings support stated preference literature’s conclusion that short driving range has been a major limitation to the large-scale adoption of battery electric vehicles (BEVs) and other AFVs, and that technological developments permitting longer driving ranges will, to some extent, facilitate their market penetration. We further propose that consumer valuation of driving range should not be examined in isolation from other attributes related to refuelling activities, such as refuelling duration and the coverage of refuelling infrastructure.     

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.