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Predicting the Market Penetration of Electric and Clean-Fuel Vehicles

Abstract

Air quality in Southern California and elsewhere could be substantially improved if some gasoline powered personal vehicles were replaced by vehicles powered by electricity or alternative fuels, such as methanol, ethanol, propane, or compressed natural gas. Quantitative market research information about how consumers are likely to respond to alternative-fuel vehicles is critical to the development of policies aimed at encouraging such technological change. 

In 1991, a three-phase stated preference (SP) survey was implemented in the South Coast Air Basin of California to predict the effect on personal vehicle purchases of attributes that potentially differentiate clean-fuel vehicles from conventional gasoline (or diesel) vehicles. These attributes included: limited availability of refueling stations, limited range between refueling or recharging, vehicle prices, fuel operating costs, emissions levels, multiple-fuel capability, and performance. Respondents were asked to choose one vehicle from each of five sets of hypothetical clean-fuel and conventional gasoline vehicles, each vehicle defined in terms of attributes manipulated according to a specific experimental design. Discrete choice models, such as the multinomial logit model, are then used to estimate how the values of the attribute levels influence purchase decisions. The SP survey choice sets were customized to each respondent's situation, as determined in the preceding Phase of the survey. The final Phase of the survey involved fuel-choice SP tasks for multi-fuel vehicles that can run on either clean fuels or gasoline. Preliminary results from a pilot sample indicate that the survey responses are plausible and will indeed be useful for forecasting.

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