A Hybrid Simulation Approach for Estimating the Market Share Evolution of Electric Vehicles

Abstract

Meeting the 21st century’s challenges of climate change and scarcity of crude oil requires a better understanding of the forces that ensure a successful market introduction of electric vehicles. Against this background, we develop a hybrid simulation approach to estimate the evolution of market shares of electric vehicles. The approach integrates a system dynamics model with an agent-based discrete choice model. System dynamics is used to model the interdependencies between consumer choice, consumer awareness, evolution of powertrain technologies, and service station availability on the macro level. By integrating the agent-based discrete choice model we refine the model parts of consumer choice and consumer awareness. This allows for considering individual consumer choices. Based on real-world data, we apply the model to the established and saturated German market, where replacement purchases dominate. This way we study the interdependencies between the evolution on the macro level and (1) individual replacement purchases as well as (2) heterogeneous consumer behavior. We show that both effects have a clear influence on the market share evolution of electric vehicles. The results indicate that neglecting individual consumer choices in aggregated system models may lead to systematically wrong estimations of the evolution of the market shares of electric vehicles.

Market introduction strategies for alternative powertrains in long-range passenger cars under competition

“…Mueller and de Haan, 2009;Walther et al, 2010;Sikes et al, 2010;Shepherd et al, 2012), customer behavior (e.g. Struben and Sterman, 2008;Zhang et al, 2011;Eppstein et al, 2011;Keith, 2012;Kieckhäfer et al, 2014), vehicle offer (e.g. Walther et al, 2010;Zhang et al, 2011;Lebeau et al, 2012), and infrastructure availability (e.g.…”

“…Keles et al, 2008;Struben and Sterman, 2008;Achtnicht et al, 2012;Keith, 2012;Ito et al, 2013). Approaches that are commonly used in market simulation include system dynamics, agent-based simulation, consumer choice models, and diffusion rate and time series models (Kieckhäfer et al, 2014;Al-Alawi and Bradley, 2013). System dynamics takes an aggregated perspective focusing on endogenous feedback structures.…”

“…Mueller and de Haan, 2009;Zhang et al, 2011). Furthermore, Shafiei et al (2013) and Kieckhäfer et al (2014) develop hybrid system dynamics and agent-based models to consider individual consumer behavior and aggregated feedback structures simultaneously.…”

“…For example, the system dynamics model of Walther et al (2010) as well as the hybrid simulation model of Kieckhäfer et al (2014) include decisions on powertrain technology, time and segment of market introduction, pricing, and improvements on the conventional powertrain, which we summarize as the market introduction strategy. However, the above models take an aggregated view on the automotive industry, which neglects the interactions between individual manufacturers and their respective strategies.…”

Industry strategies for the promotion of E-mobility under alternative policy and economic scenarios

“…However, the number of studies considering the industrial perspective is currently low in the English language (see [20][21][22]). The German automotive industry has been examined using system dynamics in various theses published in German [23][24][25], as has the Japanese market [26].…”