Transportation Deployment Casebook/2018/US Hybrid Electric Vehicles

Hybrid Electric Vehicles
Hybrid electric vehicles (HEVs) are those powered by the action of both an electric motor/generator and a traditional internal combustion engines (ICEs). Although still powered by liquid fuel, with all of the energy provided by the ICE, the hybrid function of these vehicles means that the electric motor, the electric component of the driving force, is able to improve the efficiency of the operation of this engine, which itself is also used to generate electricity using regenerative braking. Other similar technologies, such as electric vehicles, have emerged/reemerged in recent decades, each of which being distinct from hybrid electric vehicles as defined above[1]. Plug-in hybrid electric vehicles are a subset of hybrid vehicles that substitute an electric motor/generator for an onboard battery. These were introduced to the market later than other HEVs and are not included in the sales data due to the massive differences in the technologies such as the need for additional infrastructure. HEV technology was initially pursued before its most recent introduction into the market, although then it was purely electric. This was unsuccessful at that time due to technological limitations and a lack of charging stations[2], however modern HEVs have proven popular in the market largely due to an increased consciousness of the environmental impact of conventionally fuelled vehicles.[3]

Technological Characteristics
To elaborate on the HEV definition mentioned above, the ICEs and electric motors can be configured in a number of ways, the most common and simple of which being in series or parallel. The distinction between these is the same as with these terms in electric circuit design being that they are defined by the configuration of the components. Series HEVs are configured in such a way so that the majority of the energy is derived from the ICE with an electric generator then using this energy to produce electricity to create energy at a later time. The electricity generated through this process can then go on to be used to rotate the drive shaft if required. It is in parallel HEVs that, without additional generation steps, energy can be produced from either the electric motor or ICE, either separately or together to rotate the drive shaft. In the absence of a generator in a parallel configuration the electric motor can act as a generator to enable for regenerative braking. Dependent on the configuration type and operating requirements at any one time the two methods of propulsion can be used in various modes to match the conditions most efficiently[4].

Advantages
HEVs have a number of advantages over conventional ICE powered vehicles. These advantages include:


 * Improved Fuel Efficiency - As has been discussed, the combined action of the electric motor and the ICE allows for improved efficiency, as the electric motor is able to provide the energy to rotate the drive shaft when the conditions are suitable. This means that less fuel is combusted to provide energy and this efficiency is further increased by the ability of the ICE to generate electricity[5].
 * Reduced Emissions - The improved fuel efficiency also leads to less emissions being produced by vehicles during operation. This also leads to a decreased negative environmental impact, which is essentially the reason for their invention[5].
 * Reduced Running Costs - Due to an improved fuel efficiency, less fuel is consumed meaning less fuel is required to be purchased. This leads to a reduced running cost as less fuel is required to be purchased to fuel the vehicles[6].
 * Supported by Government Subsidies - In the US various government incentives have been implemented to overcome the high purchase price barrier for consumers. These incentives have taken the form of tax deductions and credits and in some states HEVs are exempted from HOV lane rules, thus decreasing the travel times of HEV drivers[7].
 * Decreased Reliance on Fossil Fuels - As has been said HEVs require less fuel. As HEVs are adopted more widely this results in fuel prices decreasing more and more as less strain is put on the limited abundance of fuels. This then causes running prices to decrease further[5].

Although some of these advantages don't apply when HEVs are compared to purely electric vehicles, HEVs do have some advantages over these vehicles, namely:


 * Longer Range - EVs require heavy onboard batteries to store the energy to rotate their drive shafts. The additional weight and limited capacity means that HEVs are able to travel further before running out of energy[8].
 * No Need for Additional Infrastructure - As EVs require charging they require charging stations, the convenience of them for private use is highly dependent on the availability of charging stations. This has been a barrier to market for that technology in the past and remains an issue. This issue is avoided by HEVs.

Disadvantages
When comparing HEVs to ICE powered vehicles there are some observed disadvantages:


 * Higher Upfront Cost - One of the barriers to market for consumers is the relatively high cost of these vehicles due to their higher production costs. This is however mitigated by incentives implemented by governments[7].


 * Less Powerful Engine - The ICEs used in HEVs, being the main source of power, are much smaller to accommodate for the electric motors. This means that the vehicle is not able to achieve the speeds or amount of acceleration of conventional vehicles. This limits their market[8].
 * Higher Maintenance Costs - HEVs are more complicated with additional parts, and due to the constantly improving technologies of the vehicles mechanics can find maintenance difficult and can result in higher costs[6].
 * High Voltage Danger - The inclusion of an electric motor with high voltages in HEVs add an additional safety concern if an accident were to occur and damage to motor.

By virtue of being completely powered by an electric motor, electric vehicles do have all of the advantages of HEVs but generally the advantage is greater for EVs, so in comparing HEVs to EVs some of the advantages of HEVs over ICEs can be considered disadvantages.

History and Invention
As has been mentioned, electrically powered vehicles have been investigated in the US prior to the introduction of HEVs to the US market. The world's first HEV was built in 1898 just three years after the first gasoline powered vehicle. This development was a combination of two technologies which had previously been invented, being gasoline powered cars and electric vehicles, which had actually been invented about 60 years before in 1834. In the early 1900's further development took place with a number of patents being filed for particular innovations. Car companies focused on the development and sale of electric vehicles were established and also sold hybrid electric vehicles. These companies faced challenges within the market and as a result HEVs and EVs both stopped being produced. These challenges were related to higher prices, less power, short range and long charge times of these vehicles, many of which still face the companies today, but to a lesser extent due to developments and incentives. The accessibility to charging infrastructure was also lack and ultimately innovations in gasoline powered vehicle technology out-paced that of EVs and HEVs[4].

After about 40 years, interest in EVs and HEVs resulted after by the Arab oil embargo. This materialised as the Electric and Hybrid Vehicle Research, Development and Demonstration Act in 1976, which recommended that these technologies be pursued again to reduce oil dependency and improve air quality. This recommendation was actioned in response to the poor air quality of Southern California in 1990. At this time a Californian government body passed a mandate to have particular amounts of zero emission vehicles in the Californian market by 1998 and 2003. Fearing that they would lose share in this large market, various automotive companies started researching EV and HEV technologies. This development was further supported by a nationwide program of cooperative research between the US government and major auto makers. Similar pushes for development in this area were being made in other countries at this time and the first modern HEV, the Toyota Prius, was introduced to the Japanese market in 1997. In the US the Toyota Prius was introduced into the market along with the Honda Insight and Civic in 1999. Soon after in 2002 development of EVs was abandoned due to the massive challenges faced by this technology, for example the need for charging infrastructure[4].

Data Analysis
Data depicting the sales of hybrid electric vehicles in the USA since their introduction in 1999 is presented in Table 1. This data was sourced from HybridCars[9] as monthly data, which was then compiled into yearly time increments for simplicity of presentation. The reliability of this data has been reinforced by its agreement with a dataset published by The U.S. Department of Transportation, Bureau of Transportation Statistics[10]. The market share column of Table 1 refers to the comparative number of HEVs sold relative to the total number of new automobiles sold. To better interpret this data in terms of modelling the lifecycle for this technology an S-curve was fitted to the data. In doing so the times at which this technology transitioned or will transition into each of its lifecycle phases can be estimated. This was done by fist estimating an initial value for K, a measure of the status of the level of saturation. From this initial estimate values to be used for a regression were then calculated according to

$$Y=\ln\left ( \frac{Sales}{K-Sales} \right )$$ Using these values a value, RSQ, indicative of the fit of those values with the dataset could be determined. By varying the values of K to maximise RSQ (0.62822) a more accurate approximation of K (509000) was produced. A linear regression was then performed using the Y values for that K as the dependent variable and the years for the independent variable. This allowed the year at which an inflection in the data occurred to be found (2009.5). Finally, using this and other values calculated using the Y values a predicted value for each year could be calculated according to the S-curve model. This was done using the equation

$$S\bigl(t\bigr)=\left ( \frac{K}{1+\exp\bigl(-b\bigl(t-t_0))} \right )$$

The results of these calculations are presented in Table 2 and Figure 1.

This model suggests that the yearly growth of electric vehicle sales grew to its maximum amount in 2009. Beyond this time electric vehicle sales have continued to increase but have done so at a decreasing rate. Assuming that the first 10% of sales growth is considered the birthing phase this phase went from 1999-2004 and with growth thereafter before an apparent maturity in 2014. The accuracy of this model is cast into doubt when considering how erratic the yearly sales figure has been, and as a result how poorly the curve fits the data. As seen it has peaked twice since the birth of HEVs before declining in subsequent years. Given that the market share of HEVs doesn’t decrease as much as the decline in sales would suggest it is likely that these lower figures have come as a result of externalities to the automotive industry, which have affected all vehicle sales. One possible externality could be the Global Financial Crash in 2008, as this had a significant impact on the US economy. There is also contention among predictive models about whether the hybrid electric vehicle market has reached maturity in the US[11], which will be discussed in the "Market Maturity" section and could therefore cast additional doubt on the accuracy of this model.

Market Birth and Development
The development of HEV technology, both prior to and after its birth into the market, was aided by government policies. Many of these were mentioned when giving an overview of the history and invention of the technology. In 1999, at birth, the cooperative research program between the US government and major auto makers was one these policies promoting the development of HEV technologies. It was intended that this policy would encourage other auto makers to release their own vehicles and expand the market. This was achieved with a number of entrants competing with the Toyota Prius and the Honda Insight and Civic[4]. Regardless of this competition the Toyota Prius dominated the early market and the combined sales of all of the Pius models are still far greater than all other HEVs[9]. The sales and yearly increases of them during the birthing phase were all relatively low. Although this is a characteristic of the birthing phase when compared to the growth phase it seems the differentials appear to be quite significant in this case. This was because policies that mitigated some of the disadvantages for consumers to purchase HEVs had not yet been implemented.

Market Growth
The growth phase from 2004-2014 can be divided into two sections when observing the actual sales data. From 2005-2007 the market for HEVs grew massively, whereas it declined from 2008-2011 in terms of sales. The great growth during from 2005-2007 was partially due to a continued increase in the number of entrants into the market and largely due to policies being implemented to make the purchase of HEVs more attractive to consumers. In 2005 the US government implemented a tax credit for the owners of hybrid vehicles, the amount of which depended on the emissions and could total several thousand dollars. Other incentives were provided by the state governments in the form of further credits up to $6000 and expectance to high occupancy vehicle lane rules[7]. As has been discussed previously, the decline from 2008-2011 is likely due to externalities that affected the entire automotive industry considering that market share did not decline to the same degree.

Market Maturity
The data analysis above suggests that hybrid electric vehicle technologies have matured in the current market. Although this is entirely possible, given the increased competition being presented by plug-in hybrid vehicles and other electric vehicles, the accuracy of this model for this dataset is not proven, and therefore other market predictions should be reviewed to test the consensus of these findings with those predictions. An article from Al-Alawi and Bradley[11] compiles a number of HEV market modelling studies and assesses the strengths and weakness of these models. The models contained within the report are more complex than this analysis but the identified weaknesses are reflected in the data set used here as some information is not known. The majority of the projections show that growth in market share will continue to grow for at least the next 20 years but at a slower rate from approximately 2020. Another analysis was conducted on the market share statistics and this showed that market maturity is expected to occur in 2013. The findings of other studies are therefore contradicted by this model so its accuracy for this dataset could be lacking. A decline was indeed observed from 2014-2016 but an increase followed in 2017.