scholarly journals Vehicle Scrappage and Gasoline Policy

2015 ◽  
Vol 105 (3) ◽  
pp. 1312-1338 ◽  
Author(s):  
Mark R. Jacobsen ◽  
Arthur A. van Benthem
Keyword(s):  
Fuel Economy ◽  
Fuel Efficiency ◽  
Rebound Effect ◽  
Gasoline Prices ◽  
Fuel Savings ◽  
Emissions Leakage ◽  
Fuel Economy Standards ◽  
Used Car ◽  
Vehicle Scrappage ◽  
Vehicle Market

We estimate the sensitivity of scrap decisions to changes in used car values and show how this “scrap elasticity” produces emissions leakage under fuel efficiency standards, a process known as the Gruenspecht effect. We first estimate the effect of gasoline prices on used vehicle values and scrappage of vehicles with different fuel economies. We then estimate the scrap elasticity itself, which we find to be −0.7. When applied in a model of fuel economy standards, 13–16 percent of the expected fuel savings leak away through the used vehicle market. This effect rivals or exceeds the importance of the often-cited mileage rebound effect. (JEL H23, L62, L78, Q35, Q38, Q48, Q58)

Importance of Vehicle Costs, Fuel Prices, and Fuel Efficiency in Hybrid Electric Vehicle Market Success

2000 ◽  
Vol 1738 (1) ◽  
pp. 11-19 ◽  
Author(s):  
Danilo J. Santini ◽  
Philip D. Patterson ◽  
Anant D. Vyas
Keyword(s):  
Electric Vehicle ◽  
Fuel Economy ◽  
Hybrid Electric Vehicle ◽  
Fuel Efficiency ◽  
Argonne National Laboratory ◽  
The United States ◽  
Fuel Price ◽  
Fuel Savings ◽  
Hybrid Electric ◽  
National Cooperative

Toyota’s introduction of a hybrid electric vehicle (HEV) named “Prius” in Japan and Honda’s proposed introduction of an HEV in the United States have generated considerable interest in the long-term viability of such fuel-efficient vehicles. A performance and cost projection model developed entirely at Argonne National Laboratory (ANL) is used to estimate costs. ANL staff developed fuel economy estimates by extending conventional vehicle modeling done primarily under the National Cooperative Highway Research Program. Together, these estimates are employed to analyze dollar costs versus benefits of two of many possible HEV technologies. Incremental costs and fuel savings are projected for a Prius-type low-performance hybrid (14.3-s 0 to 60 mph acceleration, Z60 time) and a higher-performance “mild” hybrid vehicle (11-s Z60 time). Each HEV is compared with a U.S. Toyota Corolla with automatic transmission (11-s Z60 time). The base incremental retail price range, projected a decade hence, is $3,200–$3,750, before considering battery replacement cost. Historical data are analyzed to evaluate the effect of fuel price on consumer preferences for vehicle fuel economy, performance, and size. The relationship among fuel price, the level of change in fuel price, and consumer attitude toward higher fuel efficiency also is evaluated. A recent survey on the value of higher fuel efficiency is presented and U.S. commercial viability of the hybrids is evaluated using discount rates of 20 percent and 8 percent. The analysis, with its current HEV cost estimates and current fuel savings estimates, implies that the U.S. market for such HEVs would be quite limited.

How Much Do Consumers Value Fuel Economy and Performance? Evidence from Technology Adoption

2021 ◽  
pp. 1-45
Author(s):  
Benjamin Leard ◽  
Joshua Linn ◽  
Yichen Christy Zhou
Keyword(s):  
Fuel Economy ◽  
Cost Savings ◽  
Data Set ◽  
Fuel Savings ◽  
Unique Data ◽  
Consumer Benefit ◽  
Novel Approach ◽  
High Valuation ◽  
And Performance ◽  
Historical Periods

Abstract During historical periods in which US fuel economy standards were unchanging, automakers increased performance but not fuel economy, contrasting with recent periods of tightening standards and rising fuel economy. This paper evaluates the welfare consequences of automakers forgoing performance increases to raise fuel economy as standards have tightened since 2012. Using a unique data set and a novel approach to account for fuel economy and performance endogeneity, we find undervaluation of fuel cost savings and high valuation of performance. Welfare costs of forgone performance approximately equal expected fuel savings benefits, suggesting approximately zero net private consumer benefit from tightened standards.

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