Adoption of electric vehicles by young adults in an emerging market: a case study from Argentina

Abstract

ABSTRACTThe destiny of the electric vehicle (EV) marketplace will depend upon the behaviour of potential buyers and on how emerging markets allow EVs to be perceived as a mobility solution to the externalities generated by internal combustion (IC) vehicles. To this end it is important to ascertain the role played by psychological factors, along with instrumental attributes, especially among younger adults (future purchasers) in not yet mature markets. Our paper analyses and models the propensity to purchase an EV with respect to an equivalent IC vehicle. It contributes to the existing literature investigating younger adults’ behaviour in an emerging market, focusing on the role of attitudes and perceptions. A stated preferences survey, built on real commercial scenarios (Renault ZOE vs Renault Clio), was designed and disseminated at the University of Cordoba (Argentina). Respondent behaviour was modelled within the random utility paradigm. First, heterogeneity among users was investigated through mixed multinomial logit formulation; The role of psycho-attitudinal factors was then explored through the specification of hybrid choice models with latent variables. Estimation results indicate the significant role of attitudes and perceptions in emerging markets.KEYWORDS: Hybrid Discrete Choice Modellinglatent variablesattitudesperceptionselectric vehiclesemerging markets AcknowledgementsThis study was carried out within the MOST – Sustainable Mobility National Research Center and received funding from the European Union Next-GenerationEU (PIANO NAZIONALE DI RIPRESA E RESILIENZA (PNRR) – MISSIONE 4 COMPONENTE 2, INVESTIMENTO 1.4 – D.D. 1033 17/06/2022, CN00000023). This manuscript reflects only the authors’ views and opinions, neither the European Union nor the European Commission can be considered responsible for them. This research was also partially supported by the University of Salerno, under local grants no. ORSA171328 – 2019.Disclosure statementNo potential conflict of interest was reported by the author(s).Notes1 The monthly cost of the conventional car is calculated considering the price of the car in eight years and the fuel cost to undertake urban trips for a daily travelled distance of around 40 km. Therefore, the estimated monthly cost is €200.2 It is important to recall that we are dealing with students who are undertaking the choice of purchasing an electric vehicle in a not yet infrastructured market.3 The minimum sample size was preliminarily defined in accordance with the literature (Louviere, Hensher, and Swait Citation2000; Hensher, Shore, and Train Citation2005) by using following analytical expression: n≥qpa2[ϕ−1(1+α2)]2where p is the true proportion, q = 1 – p; α is the level of confidence (0.95); a is the accuracy (10%); and is the inverse cumulative normal distribution function.4 Cronbach’s alpha is a conservative measure of reliability. In contrast, composite reliability tends to overestimate the internal consistency reliability. Therefore, according to Hair et al. (Citation2017), true reliability usually lies between Cronbach’s alpha (representing the lower bound) and composite reliability (representing the upper bound).5 Only those statements contributing to the reliability and validity of each construct are reported.6 The monthly cost attribute was the only continuous attribute, unlike the others.7 The direct elasticity is determined as: E=Δpp⋅xΔxwhere Δp is the change in the probability of choosing the "buy" alternative, due to cost variation, p is the choice probability of the alternative ‘buy', x is a the Δ_Cost between EVs and ICVs, assumed to be zero, and Δx is the delta cost variation between 10 and 100%.