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The total cost of electric vehicle ownership: A consumer-oriented study of China's post-subsidy era

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  • Ouyang, Danhua
  • Zhou, Shen
  • Ou, Xunmin

Abstract

The withdrawal of the purchase subsidy and the spread of Covid-19 have had a significant effect on Chinese consumers' purchase intentions regarding electric vehicles (EVs). Therefore, it is worthwhile analyzing the factors influencing EV purchase decisions from the consumer's perspective. We use a consumer-oriented model to analyze the total cost of ownership over 5- and 10-year holding periods in China for internal combustion engine vehicles, plug-in hybrid electric vehicles (PHEVs), and battery electric vehicles (BEVs). We include consumer usage habits and non-monetary costs to reflect consumer characteristics. The results show that the small BEVs will achieve parity before 2025, while medium-sized and large BEVs will do so around 2030. Regarding PHEVs, large and medium-sized models show better performance. Even though BEV and PHEV purchase costs will fall by 31%–36% and 16%–18%, respectively, between 2020 and 2030, most EV models will still not reach purchase cost parity by 2030. Incentive policies will have a significant impact, and oil prices are likely to have a huge impact on the time until EVs reach parity. Thus, policy-makers should introduce incentive policies aimed at ensuring a smooth transition to the electrification of China's vehicle fleet.

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  • Ouyang, Danhua & Zhou, Shen & Ou, Xunmin, 2021. "The total cost of electric vehicle ownership: A consumer-oriented study of China's post-subsidy era," Energy Policy, Elsevier, vol. 149(C).
    • Handle: RePEc:eee:enepol:v:149:y:2021:i:c:s0301421520307345
    DOI: 10.1016/j.enpol.2020.112023
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