IDEAS home Printed from https://ideas.repec.org/a/inm/ormsom/v19y2017i2p309-327.html
   My bibliography  Save this article

Service Region Design for Urban Electric Vehicle Sharing Systems

Author

Listed:
  • Long He

    (NUS Business School, National University of Singapore, Singapore 119245)

  • Ho-Yin Mak

    (Saïd Business School, University of Oxford, Oxford OX1 1HP, United Kingdom)

  • Ying Rong

    (Antai College of Economics and Management, Shanghai Jiao Tong University, Shanghai, China 200030)

  • Zuo-Jun Max Shen

    (Department of Industrial Engineering and Operations Research and Department of Civil and Environmental Engineering, University of California, Berkeley, Berkeley, California 94720)

Abstract

Emerging collaborative consumption business models have shown promise in terms of both generating business opportunities and enhancing the efficient use of resources. In the transportation domain, car-sharing models are being adopted on a mass scale in major metropolitan areas worldwide. This mode of servicized mobility bridges the resource efficiency of public transit and the flexibility of personal transportation. Beyond the significant potential to reduce car ownership, car sharing shows promise in supporting the adoption of fuel-efficient vehicles, such as electric vehicles (EVs), because of these vehicles’ special cost structure with high purchase but low operating costs. Recently, key players in the car-sharing business, such as Autolib’, car2go, and DriveNow, have begun to employ EVs in an operations model that accommodates one-way trips. On the one hand (and particularly in free-floating car sharing), the one-way model results in significant improvements in coverage of travel needs and therefore in adoption potential compared with the conventional round-trip-only model (advocated by Zipcar, for example). On the other hand, this model poses tremendous planning and operational challenges. In this work, we study the planning problem faced by service providers in designing a geographical service region in which to operate the service. This decision entails trade-offs between maximizing customer catchment by covering travel needs and controlling fleet operation costs. We develop a mathematical programming model that incorporates details of both customer adoption behavior and fleet management (including EV repositioning and charging) under imbalanced travel patterns. To address inherent planning uncertainty with regard to adoption patterns, we employ a distributionally robust optimization framework that informs robust decisions to overcome possible ambiguity (or lacking) of data. Mathematically, the problem can be approximated by a mixed integer second-order cone program, which is computationally tractable with practical scale data. Applying this approach to the case of car2go’s service with real operations data, we address a number of planning questions and suggest that there is potential for the future development of this service.

Suggested Citation

  • Long He & Ho-Yin Mak & Ying Rong & Zuo-Jun Max Shen, 2017. "Service Region Design for Urban Electric Vehicle Sharing Systems," Manufacturing & Service Operations Management, INFORMS, vol. 19(2), pages 309-327, May.
    • Handle: RePEc:inm:ormsom:v:19:y:2017:i:2:p:309-327
    DOI: 10.1287/msom.2016.0611
    as

    Download full text from publisher

    File URL: https://doi.org/10.1287/msom.2016.0611
    Download Restriction: no
    File URL: https://libkey.io/10.1287/msom.2016.0611?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Gérard P. Cachon & Kaitlin M. Daniels & Ruben Lobel, 2017. "The Role of Surge Pricing on a Service Platform with Self-Scheduling Capacity," Manufacturing & Service Operations Management, INFORMS, vol. 19(3), pages 368-384, July.
    2. Qingxia Kong & Chung-Yee Lee & Chung-Piaw Teo & Zhichao Zheng, 2013. "Scheduling Arrivals to a Stochastic Service Delivery System Using Copositive Cones," Operations Research, INFORMS, vol. 61(3), pages 711-726, June.
    3. Boyacı, Burak & Zografos, Konstantinos G. & Geroliminis, Nikolas, 2015. "An optimization framework for the development of efficient one-way car-sharing systems," European Journal of Operational Research, Elsevier, vol. 240(3), pages 718-733.
    4. Karthik Natarajan & Chung Piaw Teo & Zhichao Zheng, 2011. "Mixed 0-1 Linear Programs Under Objective Uncertainty: A Completely Positive Representation," Operations Research, INFORMS, vol. 59(3), pages 713-728, June.
    5. Ioannis Bellos & Mark Ferguson & L. Beril Toktay, 2017. "The Car Sharing Economy: Interaction of Business Model Choice and Product Line Design," Manufacturing & Service Operations Management, INFORMS, vol. 19(2), pages 185-201, May.
    6. Martin, Elliot & Shaheen, Susan Alison & Lidicker, Jeffrey, 2010. "Carsharing’S Impact On Household Vehicle Holdings: Results From A North American Shared-Use Vehicle Survey," Institute of Transportation Studies, Working Paper Series qt0850h6r5, Institute of Transportation Studies, UC Davis.
    7. Jia Shu & Mabel C. Chou & Qizhang Liu & Chung-Piaw Teo & I-Lin Wang, 2013. "Models for Effective Deployment and Redistribution of Bicycles Within Public Bicycle-Sharing Systems," Operations Research, INFORMS, vol. 61(6), pages 1346-1359, December.
    8. Ho-Yin Mak & Ying Rong & Zuo-Jun Max Shen, 2013. "Infrastructure Planning for Electric Vehicles with Battery Swapping," Management Science, INFORMS, vol. 59(7), pages 1557-1575, July.
    9. Linda Green & Peter Kolesar, 1991. "The Pointwise Stationary Approximation for Queues with Nonstationary Arrivals," Management Science, INFORMS, vol. 37(1), pages 84-97, January.
    10. Dimitris Bertsimas & Melvyn Sim, 2004. "The Price of Robustness," Operations Research, INFORMS, vol. 52(1), pages 35-53, February.
    11. Samuel P. Fraiberger & Arun Sundararajan, 2015. "Peer-to-Peer Rental Markets in the Sharing Economy," Working Papers 15-19, NET Institute.
    12. Wenqing Chen & Melvyn Sim & Jie Sun & Chung-Piaw Teo, 2010. "From CVaR to Uncertainty Set: Implications in Joint Chance-Constrained Optimization," Operations Research, INFORMS, vol. 58(2), pages 470-485, April.
    13. Correia, Gonçalo Homem de Almeida & Antunes, António Pais, 2012. "Optimization approach to depot location and trip selection in one-way carsharing systems," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 48(1), pages 233-247.
    14. Erica L. Plambeck, 2013. "OM Forum —Operations Management Challenges for Some “Cleantech” Firms," Manufacturing & Service Operations Management, INFORMS, vol. 15(4), pages 527-536, October.
    15. Laurent El Ghaoui & Maksim Oks & Francois Oustry, 2003. "Worst-Case Value-At-Risk and Robust Portfolio Optimization: A Conic Programming Approach," Operations Research, INFORMS, vol. 51(4), pages 543-556, August.
    16. Michael K. Lim & Ho-Yin Mak & Ying Rong, 2015. "Toward Mass Adoption of Electric Vehicles: Impact of the Range and Resale Anxieties," Manufacturing & Service Operations Management, INFORMS, vol. 17(1), pages 101-119, February.
    17. Martin, Elliot & Shaheen, Susan Alison & Lidicker, Jeffrey, 2010. "Carsharing’S Impact On Household Vehicle Holdings: Results From A North American Shared-Use Vehicle Survey," Institute of Transportation Studies, Research Reports, Working Papers, Proceedings qt0850h6r5, Institute of Transportation Studies, UC Berkeley.
    18. A. Ben-Tal & A. Nemirovski, 1998. "Robust Convex Optimization," Mathematics of Operations Research, INFORMS, vol. 23(4), pages 769-805, November.
    19. Xin Chen & Melvyn Sim & Peng Sun, 2007. "A Robust Optimization Perspective on Stochastic Programming," Operations Research, INFORMS, vol. 55(6), pages 1058-1071, December.
    20. Schneider, M. & Stenger, A. & Goeke, D., 2014. "The Electric Vehicle Routing Problem with Time Windows and Recharging Stations," Publications of Darmstadt Technical University, Institute for Business Studies (BWL) 62382, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL).
    21. Marcus Ang & Yun Fong Lim & Melvyn Sim, 2012. "Robust Storage Assignment in Unit-Load Warehouses," Management Science, INFORMS, vol. 58(11), pages 2114-2130, November.
    22. Joel Goh & Melvyn Sim, 2010. "Distributionally Robust Optimization and Its Tractable Approximations," Operations Research, INFORMS, vol. 58(4-part-1), pages 902-917, August.
    23. Michael Schneider & Andreas Stenger & Dominik Goeke, 2014. "The Electric Vehicle-Routing Problem with Time Windows and Recharging Stations," Transportation Science, INFORMS, vol. 48(4), pages 500-520, November.
    24. Firnkorn, Jörg & Müller, Martin, 2011. "What will be the environmental effects of new free-floating car-sharing systems? The case of car2go in Ulm," Ecological Economics, Elsevier, vol. 70(8), pages 1519-1528, June.
    25. Nourinejad, Mehdi & Zhu, Sirui & Bahrami, Sina & Roorda, Matthew J., 2015. "Vehicle relocation and staff rebalancing in one-way carsharing systems," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 81(C), pages 98-113.
    26. Martin, Elliot & Shaheen, Susan A & Lidicker, Jeffrey, 2010. "Impact of Carsharing on Household Vehicle Holdings: Resultsvfrom a North American Shared-Use Vehicle Survey," Institute of Transportation Studies, Research Reports, Working Papers, Proceedings qt3bn9n6pq, Institute of Transportation Studies, UC Berkeley.
    27. Ho-Yin Mak & Zuo-Jun Max Shen, 2014. "Pooling and Dependence of Demand and Yield in Multiple-Location Inventory Systems," Manufacturing & Service Operations Management, INFORMS, vol. 16(2), pages 263-269, May.
    28. Erick Delage & Yinyu Ye, 2010. "Distributionally Robust Optimization Under Moment Uncertainty with Application to Data-Driven Problems," Operations Research, INFORMS, vol. 58(3), pages 595-612, June.
    29. Daniel Adelman, 2007. "Price-Directed Control of a Closed Logistics Queueing Network," Operations Research, INFORMS, vol. 55(6), pages 1022-1038, December.
    30. Song-Hee Kim & Ward Whitt, 2014. "Are Call Center and Hospital Arrivals Well Modeled by Nonhomogeneous Poisson Processes?," Manufacturing & Service Operations Management, INFORMS, vol. 16(3), pages 464-480, July.
    31. Chuen-Teck See & Melvyn Sim, 2010. "Robust Approximation to Multiperiod Inventory Management," Operations Research, INFORMS, vol. 58(3), pages 583-594, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Long He & Guangrui Ma & Wei Qi & Xin Wang, 2021. "Charging an Electric Vehicle-Sharing Fleet," Manufacturing & Service Operations Management, INFORMS, vol. 23(2), pages 471-487, March.
    2. Mengshi Lu & Zuo‐Jun Max Shen, 2021. "A Review of Robust Operations Management under Model Uncertainty," Production and Operations Management, Production and Operations Management Society, vol. 30(6), pages 1927-1943, June.
    3. Zhi Chen & Melvyn Sim & Huan Xu, 2019. "Distributionally Robust Optimization with Infinitely Constrained Ambiguity Sets," Operations Research, INFORMS, vol. 67(5), pages 1328-1344, September.
    4. Golalikhani, Masoud & Oliveira, Beatriz Brito & Carravilla, Maria Antónia & Oliveira, José Fernando & Antunes, António Pais, 2021. "Carsharing: A review of academic literature and business practices toward an integrated decision-support framework," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 149(C).
    5. L. Jeff Hong & Zhiyuan Huang & Henry Lam, 2021. "Learning-Based Robust Optimization: Procedures and Statistical Guarantees," Management Science, INFORMS, vol. 67(6), pages 3447-3467, June.
    6. Shao-Wei Lam & Tsan Sheng Ng & Melvyn Sim & Jin-Hwa Song, 2013. "Multiple Objectives Satisficing Under Uncertainty," Operations Research, INFORMS, vol. 61(1), pages 214-227, February.
    7. Ho-Yin Mak & Ying Rong & Zuo-Jun Max Shen, 2013. "Infrastructure Planning for Electric Vehicles with Battery Swapping," Management Science, INFORMS, vol. 59(7), pages 1557-1575, July.
    8. Jiao, Zihao & Ran, Lun & Zhang, Yanzi & Ren, Yaping, 2021. "Robust vehicle-to-grid power dispatching operations amid sociotechnical complexities," Applied Energy, Elsevier, vol. 281(C).
    9. Fanwen Meng & Jin Qi & Meilin Zhang & James Ang & Singfat Chu & Melvyn Sim, 2015. "A Robust Optimization Model for Managing Elective Admission in a Public Hospital," Operations Research, INFORMS, vol. 63(6), pages 1452-1467, December.
    10. Dimitris Bertsimas & Melvyn Sim & Meilin Zhang, 2019. "Adaptive Distributionally Robust Optimization," Management Science, INFORMS, vol. 65(2), pages 604-618, February.
    11. Zihao Jiao & Lun Ran & Xin Liu & Yuli Zhang & Robin G. Qiu, 2020. "Integrating Price-Incentive and Trip-Selection Policies to Rebalance Shared Electric Vehicles," Service Science, INFORMS, vol. 12(4), pages 148-173, December.
    12. Fu, Chenyi & Zhu, Ning & Ma, Shoufeng & Liu, Ronghui, 2022. "A two-stage robust approach to integrated station location and rebalancing vehicle service design in bike-sharing systems," European Journal of Operational Research, Elsevier, vol. 298(3), pages 915-938.
    13. Long He & Zhenyu Hu & Meilin Zhang, 2020. "Robust Repositioning for Vehicle Sharing," Manufacturing & Service Operations Management, INFORMS, vol. 22(2), pages 241-256, March.
    14. Liu, Kanglin & Li, Qiaofeng & Zhang, Zhi-Hai, 2019. "Distributionally robust optimization of an emergency medical service station location and sizing problem with joint chance constraints," Transportation Research Part B: Methodological, Elsevier, vol. 119(C), pages 79-101.
    15. Shipra Agrawal & Yichuan Ding & Amin Saberi & Yinyu Ye, 2012. "Price of Correlations in Stochastic Optimization," Operations Research, INFORMS, vol. 60(1), pages 150-162, February.
    16. Boyacı, Burak & Zografos, Konstantinos G., 2019. "Investigating the effect of temporal and spatial flexibility on the performance of one-way electric carsharing systems," Transportation Research Part B: Methodological, Elsevier, vol. 129(C), pages 244-272.
    17. Gabrel, Virginie & Murat, Cécile & Thiele, Aurélie, 2014. "Recent advances in robust optimization: An overview," European Journal of Operational Research, Elsevier, vol. 235(3), pages 471-483.
    18. Gülpınar, Nalan & Pachamanova, Dessislava & Çanakoğlu, Ethem, 2013. "Robust strategies for facility location under uncertainty," European Journal of Operational Research, Elsevier, vol. 225(1), pages 21-35.
    19. Grani A. Hanasusanto & Vladimir Roitch & Daniel Kuhn & Wolfram Wiesemann, 2017. "Ambiguous Joint Chance Constraints Under Mean and Dispersion Information," Operations Research, INFORMS, vol. 65(3), pages 751-767, June.
    20. Jang Ho Kim & Woo Chang Kim & Frank J. Fabozzi, 2014. "Recent Developments in Robust Portfolios with a Worst-Case Approach," Journal of Optimization Theory and Applications, Springer, vol. 161(1), pages 103-121, April.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ormsom:v:19:y:2017:i:2:p:309-327. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.