Car fuel-type choice under travel demand management and economic incentives

Future levels of vehicle air pollution in urban areas will depend on the proportion of new car buyers who opt for less polluting vehicles, as these appear on the market. This paper examines the factors likely to influence the demand for lower emission and zero emission vehicles. Using a discrete choice experiment, suburban driver commuters choose between three types of vehicle, one conventional, one fuel-efficient and one electric. Each is characterized by varying vehicle cost and performance measures, range and refueling rates, and commuting costs and times. The latter are manipulated to determine how their use as economic instruments might influence vehicle choice. All cost and time variables are expressed as ratios of the respondent’s current situation. Parameters of a multinomial discrete choice model are used in a choice simulator to estimate the average choice probability of each type of vehicle under different scenarios reflecting possible future relative vehicle prices and performance levels as well as differential commuting costs and times based on policies aimed at encouraging the purchase of cleaner vehicles. The evidence is that the latter economic instruments will have modest effects on vehicle choice. By contrast there would be a large shift of demand to cleaner and zero-emission vehicles provided their cost and performance came within an acceptable range of conventional vehicles.