Analysis of China’s Pure Electric Vehicle Sales Based on Spatial Econometric Models

Abstract

This paper empirically investigates the spatial dependence and serial correlation structures among different China’s brands of pure electric vehicle (EV) sales using spatial econometric models. Based on the newly proposed economic distance spatial weight matrix, the empirical results show that EV endurance mileage, power battery capacity, charging time, government subsidy, retail price, and each brand market share have important impacts on EV sales. The per capita disposable income of urban households, gasoline price, loan rate and the number of charging pile are statistically significant determinants of EV sales. In particular, the improvements of the number of charging pile and the rise of gasoline price can increase EV sales, while the rise of loan rate or tight monetary policy may increase the consumers’ cost of purchasing EVs and then decrease EV sales. Another interesting finding is that though the per capita disposable income of urban households increases the EV sales decreases. A plausible explanation would seem to be that the impact of the per capita disposable income of urban households on the EV sales is offset by the decline in government subsidies or the incomplete infrastructures such as the inconvenient of charging stations. Besides, the significantly positive spatial dependence and serial correlation exist among EV manufactures indicates that when developing EV sales strategies, EV manufacturers must consider not only the properties of the EVs they produce, but also the properties of similar types of EVs produced by other brands in the EV market.