Will changes in charging and gasoline prices affect electric vehicle sales? Evidence from China.

Abstract

Electric vehicles and gasoline vehicles are substitutes for each other, and the cost of fuel is an important factor when consumers are faced with choices. Understanding the influence of changes in gasoline prices and charging prices on electric vehicle sales is of reference significance for promoting electric vehicles in the private sector. This paper uses data covering 212 prefecture-level cities from January, 2020, to August, 2022, for analysis, and the results show that different income groups have different sensitivities to the difference in oil and electricity prices. Additionally, changes in gasoline prices and charging prices will significantly affect electric vehicle sales in low-income and middle-income cities, electric vehicle sales in high-income cities will not be affected. Compared with nonpilot cities, residents of pilot cities are more sensitive to fuel price changes, indicating that the policy basis has a certain positive effect on the promotion of electric vehicles. It is recommended to consider the income status of regional residents when formulating policies for the use of electric vehicles. At the same time, publicity efforts should be increased to highlight the gap between the cost of fuel vehicles and electric vehicles.