How to Improve the Total Cost of Ownership of Electric Vehicles: An Analysis of the Light Commercial Vehicle Segment

Abstract

Cathy.Macharis@vub.be (C.M.); Joeri.Van.Mierlo@vub.be (J.V.M.) 2 Flanders Make, 3001 Heverlee, BelgiumAbstract: This paper analyses how the total cost of ownership (TCO) of electric light commercial vehicles change with the number of kilometers driven, the period of ownership, the residual value of the battery, and different fiscal incentives, as well as a kilometer charging scheme. This paper demonstrates that a kilometer-based charge and reduced fiscal incentives for conventional vans can drastically improve the TCO of electric commercial light duty vehicles. Second life applications for batteries could also have a strong impact on the TCO of electric vans as they could retrieve a better residual value. Finally, the paper shows that the TCO of electric vans can be optimized based on its usage. These are important findings given the ambitious objective of carbon free city logistics by 2030. Adoption of electric vans remains very low and this paper offers an up to date analysis to stimulate the electrification of light commercial vehicles, a segment that is growing fast in city logistics.

Transportation-Mission-Based Optimization of Heterogeneous Heavy-Vehicle Fleet Including Electrified Propulsion

“…The weight and volume of goods, operating range, payload, utilization level, purchase cost, charging infrastructure, battery life, energy consumption, available routes, average speed, and logistics are among the factors that affect the profitability of battery electric heavy vehicles, according to [2,3,5,11,20,23,[26][27][28][29][30][31][32]. TCO provides a good means of estimating profitability and is used for comparative analysis of the competitive technologies [3,5,20,23,[26][27][28][29][33][34][35][36][37][38][39]. Literature suggests that vehicle customization based on the use case helps profitability of the battery electric heavy vehicles.…”

Comparing Total Cost of Ownership of Electric and Conventional Motorcycles in Indonesia

“…Electric motorcycle manufacturers needed to understand the characteristics of the intended target market to increase sales [50]. Although not fully used as a marketing tool, education about TCO regarding the importance of understanding the value of TCO compared to the selling price offered could be conveyed by producers to consumers when they make direct offers.…”

Total Cost of Ownership Analysis of the Impact of Vehicle Usage on the Economic Viability of Electric Vehicles in India

“…Equation 1 has been used in a Microsoft Excel-based tool to calculate TCO per km for different vehicle segments, such as two-wheelers (2W), three-wheelers (3W), fourwheelers (4W)-small cars (hatchback) and mid-sized cars (sedan)-and buses. For TCO calculation, input data was collected from sources like research articles, reports, vehicle manufacturers' websites, auto online portals for sale and purchase of the vehicles, and so forth (24)(25)(26)(27)(28). Some inputs were also cross-checked with consumers and experts from the automobile sector.…”

“…This provided the representative value for purchase cost and AOC of the vehicles along with the technological details. Input data and assumptions: Based on analysis of the literature, a vehicle holding period of 10 years and a discount rate of 10% was assumed for all vehicle segments (13,20,(14)(15)(16)(17)(18)(19)(20)(21)(22)(23)(24)(25)(26)(27)(28)(29). The resale value was assumed to be 10% for all ICE vehicles and 20% for all EVs except e-2Ws.…”