Commercial Fleet Vehicle Additions and Replacements and the Potential Market Penetration for Electric Vehicles

Abstract

Commercial fleets can play a major role in the rapid evolution of plugin hybrid electric vehicles (PHEV) and battery electric vehicles (BEV) market penetration. Using survey data in this analysis we identify groups of commercial fleets based on the attributes of the next vehicle planned to be added to a fleet and the propensity of replacing a current vehicle with an electric vehicle. We first develop principal components representing dimensions of the desired vehicle characteristics (price, efficiency, size and fuel type, timing of vehicle procurement, replacement of current vehicle or addition to the fleet, and intended purchase of new, used, or leased). Using 8 principal components capturing approximately 91.55% of the variance in the variables listed above and hierarchical clustering we derive six distinct market segments. One segment contains 43.5% of the total responses preferring a PHEV to replace a current vehicle in the fleet, it is a segment that is composed of 100% PHEV preferring respondents and almost all of them expect to purchase a small vehicle and 92% will do that within 5 years. The average price they expect to pay is approximately $27,000 and the expected efficiency to be about 55 miles per gallon equivalent (MPGe). Another segment contains 91.0% BEV preferring respondents who are only 11.6% of the sample. This segment also prefers small vehicles to replace vehicles in their fleet, possibly leasing and expecting to pay approximately $46,800 with an efficiency of about 100 MPGe. The other four segments are dominated by gasoline, diesel, and natural gas internal combustion engine vehicles.