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A win-win marginal rent analysis for operator and consumer under battery leasing mode in China electric vehicle market

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  • Li, Zhe
  • Ouyang, Minggao

Abstract

Recently battery leasing has been introduced into the market by automobile manufacturers and power suppliers due to its potential to reduce the purchase cost of electric vehicles (EVs). However, the profit prospect of battery leasing is still uncertain. This paper takes the views of both the operators and consumers and calculates the 'win-win' marginal rent, which not only ensures the profitability of operators, but also allows consumers a lower expenditure than using Internal combustion engine vehicles (ICVs) and EVs with embedded batteries. Battery cost, vehicle weight, gasoline and electricity price, and the discount rate have impacts on the rent. Battery cost plays a dominant role and a battery cost >5 ¥/W h fails to enable the survival of battery leasing to all types of EVs. Battery leasing would be more competitive when focusing on heavier EVs. At least one of the three thresholds is required for the existence of rent pricing range for a 1000 kg EV: gasoline retail price >6 ¥/L, electricity price

Suggested Citation

  • Li, Zhe & Ouyang, Minggao, 2011. "A win-win marginal rent analysis for operator and consumer under battery leasing mode in China electric vehicle market," Energy Policy, Elsevier, vol. 39(6), pages 3222-3237, June.
    • Handle: RePEc:eee:enepol:v:39:y:2011:i:6:p:3222-3237
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    Cited by:

    1. Zhao, Xin & Doering, Otto C. & Tyner, Wallace E., 2015. "The economic competitiveness and emissions of battery electric vehicles in China," Applied Energy, Elsevier, vol. 156(C), pages 666-675.
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    3. Li, Zhe & Ouyang, Minggao, 2011. "The pricing of charging for electric vehicles in China—Dilemma and solution," Energy, Elsevier, vol. 36(9), pages 5765-5778.
    4. Cong Hou & Hewu Wang & Minggao Ouyang, 2014. "Battery Sizing for Plug-in Hybrid Electric Vehicles in Beijing: A TCO Model Based Analysis," Energies, MDPI, vol. 7(8), pages 1-26, August.
    5. Fan, Jing-Li & Wang, Jia-Xing & Zhang, Xian, 2020. "An innovative subsidy model for promoting the sharing of Electric Vehicles in China: A pricing decisions analysis," Energy, Elsevier, vol. 201(C).
    6. Kong, Deyang & Xia, Quhong & Xue, Yixi & Zhao, Xin, 2020. "Effects of multi policies on electric vehicle diffusion under subsidy policy abolishment in China: A multi-actor perspective," Applied Energy, Elsevier, vol. 266(C).
    7. Gong, Ke & Zheng, Wei & Shu, Yingting, 2024. "Battery leasing business for hydrogen fuel cell vehicles: Motorists' costs, adoption, and manufacturers’ profits," Energy, Elsevier, vol. 293(C).
    8. Li, Kate J. & Xu, Susan H., 2015. "The comparison between trade-in and leasing of a product with technology innovations," Omega, Elsevier, vol. 54(C), pages 134-146.
    9. Kaifu Yuan & Chao Li & Guangqiang Wu, 2023. "Study on Vehicle Supply Chain Operation Mode Selection Based on Battery Leasing and Battery Swapping Services," Mathematics, MDPI, vol. 11(14), pages 1-21, July.
    10. Zhou, Guanghui & Ou, Xunmin & Zhang, Xiliang, 2013. "Development of electric vehicles use in China: A study from the perspective of life-cycle energy consumption and greenhouse gas emissions," Energy Policy, Elsevier, vol. 59(C), pages 875-884.

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