Adoption of Electric Vehicles in Car Sharing Market

Hossein Abouee‐Mehrizi, Opher Baron, Oded Berman and David Chen

Production and Operations Management, 2021, vol. 30, issue 1, 190-209

Abstract: In this study, we examine whether it is optimal to use electric vehicles (EVs) in the car sharing market and investigate the environmental impact of pulling the EVs from the market. We develop a model consisting of a profit‐maximizing car sharing company (CSC) and a population of utility‐maximizing customers. The CSC sets the number of EVs, the number of fuel vehicles (FVs), and the rental price jointly to maximize its profit. Customers decide whether to use EVs, FVs, or public transportation to complete their trips considering the rental price. We show that it is optimal to use EVs only if the charging speed, the number of charging stations, and the range of EVs are high enough. Among these three conditions, the recharging speed is the most important and the number of charging stations is more important than the range of EVs. We also find that including EVs in the car sharing market may lead to a higher total emission when ignoring customers’ other transportation choices (due to a lower rental price that results in a higher usage rate). Moreover, we consider the problem with the objective of maximizing the social welfare and find that when considering the environmental impact, governments should tax the CSC to induce a higher rental price and when ignoring this impact, they should subsidize the CSC to reduce the rental price. We demonstrate our results with the case study of Car2go. These results are in line with that the slow recharging speed may have been one of the contributing factors to that Car2go replaced EVs with FVs in San Diego.

Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

Downloads: (external link)
https://doi.org/10.1111/poms.13262

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:popmgt:v:30:y:2021:i:1:p:190-209

Ordering information: This journal article can be ordered from
http://onlinelibrary ... 1111/(ISSN)1937-5956

Access Statistics for this article

Production and Operations Management is currently edited by Kalyan Singhal

More articles in Production and Operations Management from Production and Operations Management Society
Bibliographic data for series maintained by Wiley Content Delivery ().