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Dissecting the total cost of ownership of fully electric cars in Italy: The impact of annual distance travelled, home charging and urban driving

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  • Scorrano, Mariangela
  • Danielis, Romeo
  • Giansoldati, Marco

Abstract

The paper quantifies the importance for cost competitiveness of fully electric cars (BEVs) of three determinants of the total cost of ownership (TCO): the annual distance travelled (ADT), the percentage of urban trips, and the availability of a private parking space. The estimates are performed with reference to the Italian car market. We find that charging at home increases the break-even BEV manufacturer's suggested retail price (MSRP) relative to other propulsion systems by €2866-11,466, depending on the ADT. Driving in urban areas increases the break-even BEV MSRP by €910-10,314, depending on the ADT and on the referenced propulsion system. Taking into account the share of Italian drivers who own a garage and drive in urban areas, we find the cheapest BEVs are cost competitive without a subsidy with respect to the HEVs for 11.8% of the Italian drivers, but not with respect to the diesel and petrol cars, unless extremely high annual distances are driven. With the purchase subsidy recently introduced by the Italian government, the cheapest BEVs become competitive also with respect to the diesel cars, but not relative to the petrol cars, unless more than 12,500 km are annually driven.

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  • Scorrano, Mariangela & Danielis, Romeo & Giansoldati, Marco, 2020. "Dissecting the total cost of ownership of fully electric cars in Italy: The impact of annual distance travelled, home charging and urban driving," Research in Transportation Economics, Elsevier, vol. 80(C).
    • Handle: RePEc:eee:retrec:v:80:y:2020:i:c:s0739885919303208
    DOI: 10.1016/j.retrec.2019.100799
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    References listed on IDEAS

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    Cited by:

    1. Danielis, Romeo & Rotaris, Lucia & Giansoldati, Marco & Scorrano, Mariangela, 2020. "Drivers’ preferences for electric cars in Italy. Evidence from a country with limited but growing electric car uptake," Transportation Research Part A: Policy and Practice, Elsevier, vol. 137(C), pages 79-94.
    2. Kristián Čulík & Vladimíra Štefancová & Karol Hrudkay & Ján Morgoš, 2021. "Interior Heating and Its Influence on Electric Bus Consumption," Energies, MDPI, vol. 14(24), pages 1-19, December.
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    5. Roberta Riverso & Carmela Altamura & Francesco La Barbera, 2023. "Consumer Intention to Buy Electric Cars: Integrating Uncertainty in the Theory of Planned Behavior," Sustainability, MDPI, vol. 15(11), pages 1-13, May.
    6. Kondev, Bozhil & Dixon, James & Zhou, Zhaoqi & Sabyrbekov, Rahat & Sultanaliev, Kanat & Hirmer, Stephanie A., 2023. "Putting the foot down: Accelerating EV uptake in Kyrgyzstan," Transport Policy, Elsevier, vol. 131(C), pages 87-96.
    7. Gulnaz Ivanova & António Carrizo Moreira, 2023. "Antecedents of Electric Vehicle Purchase Intention from the Consumer’s Perspective: A Systematic Literature Review," Sustainability, MDPI, vol. 15(4), pages 1-27, February.
    8. 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).
    9. Liu, Zhe & Song, Juhyun & Kubal, Joseph & Susarla, Naresh & Knehr, Kevin W. & Islam, Ehsan & Nelson, Paul & Ahmed, Shabbir, 2021. "Comparing total cost of ownership of battery electric vehicles and internal combustion engine vehicles," Energy Policy, Elsevier, vol. 158(C).
    10. Santos, Georgina & Rembalski, Sebastian, 2021. "Do electric vehicles need subsidies in the UK?," Energy Policy, Elsevier, vol. 149(C).
    11. Rotaris, Lucia & Giansoldati, Marco & Scorrano, Mariangela, 2021. "The slow uptake of electric cars in Italy and Slovenia. Evidence from a stated-preference survey and the role of knowledge and environmental awareness," Transportation Research Part A: Policy and Practice, Elsevier, vol. 144(C), pages 1-18.
    12. Paolo Lazzeroni & Brunella Caroleo & Maurizio Arnone & Cristiana Botta, 2021. "A Simplified Approach to Estimate EV Charging Demand in Urban Area: An Italian Case Study," Energies, MDPI, vol. 14(20), pages 1-18, October.
    13. Mariangela Scorrano & Terje Andreas Mathisen & Marco Giansoldati, 2019. "Is electric car uptake driven by monetary factors? A total cost of ownership comparison between Norway and Italy," ECONOMICS AND POLICY OF ENERGY AND THE ENVIRONMENT, FrancoAngeli Editore, vol. 0(2), pages 99-132.
    14. Mariangela Scorrano & Romeo Danielis & Stefano Pastore & Vanni Lughi & Alessandro Massi Pavan, 2020. "Modeling the Total Cost of Ownership of an Electric Car Using a Residential Photovoltaic Generator and a Battery Storage Unit—An Italian Case Study," Energies, MDPI, vol. 13(10), pages 1-21, May.
    15. Yanhua Liang & Hongjuan Lu, 2022. "Dynamic Evaluation and Regional Differences Analysis of the NEV Industry Development in China," Sustainability, MDPI, vol. 14(21), pages 1-23, October.
    16. Agovino, Massimiliano & Ferraro, Aniello & Garofalo, Antonio, 2023. "Are green cars an optimal and efficient choice for motorists? Evidence from Italy," Transport Policy, Elsevier, vol. 141(C), pages 140-151.
    17. Hao, Xu & Lin, Zhenhong & Wang, Hewu & Ou, Shiqi & Ouyang, Minggao, 2020. "Range cost-effectiveness of plug-in electric vehicle for heterogeneous consumers: An expanded total ownership cost approach," Applied Energy, Elsevier, vol. 275(C).
    18. Giansoldati, Marco & Monte, Adriana & Scorrano, Mariangela, 2020. "Barriers to the adoption of electric cars: Evidence from an Italian survey," Energy Policy, Elsevier, vol. 146(C).
    19. Simolin, Toni & Rauma, Kalle & Viri, Riku & Mäkinen, Johanna & Rautiainen, Antti & Järventausta, Pertti, 2021. "Charging powers of the electric vehicle fleet: Evolution and implications at commercial charging sites," Applied Energy, Elsevier, vol. 303(C).
    20. Malima, Gabriel Clement & Moyo, Francis, 2023. "Are electric vehicles economically viable in sub-Saharan Africa? The total cost of ownership of internal combustion engine and electric vehicles in Tanzania," Transport Policy, Elsevier, vol. 141(C), pages 14-26.
    21. Schwab, Julia & Sölch, Christian & Zöttl, Gregor, 2022. "Electric Vehicle Cost in 2035: The impact of market penetration and charging strategies," Energy Economics, Elsevier, vol. 114(C).
    22. Say, Kelvin & Csereklyei, Zsuzsanna & Brown, Felix Gabriel & Wang, Changlong, 2023. "The economics of public transport electrification: A case study from Victoria, Australia," Energy Economics, Elsevier, vol. 120(C).

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    More about this item

    Keywords

    Total cost of ownership; Electric car; Home charging; Urban travelling; Purchase subsidy;
    All these keywords.

    JEL classification:

    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

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