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Total Cost of Ownership Analysis for Passenger Cars in Turkey

Özdemir, Enver Doruk and Tosun, Hasan Basri (2015) Total Cost of Ownership Analysis for Passenger Cars in Turkey. International Association for Energy Economics -IAEE International Conference, 25-27. Mai. 2015, Antalya, Türkei.

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Official URL: http://www.iaee.org/iaee2015/program_concurrent.aspx#2

Abstract

Being a developing country, the number of vehicles in the stock and vehicle ownership per person are increasing rapidly over the last few years in Turkey. In Turkey, the one-time purchase taxes implemented on vehicles are significantly high (up to 189% of the purchase price without tax), which might affect the choice of vehicle powertrain. Furthermore, the fuel price levels are one of the highest in the world due to the implemented fuel taxes especially for gasoline and diesel. As a result of these taxation policies, 42% of the current vehicle stock is powered by liquefied petroleum gas (LPG) fuel, which is the highest LPG share in the world. Therefore, it is of highest interest to analyse the cost structure of Turkish passenger car sector. The aim of this study is to develop a TCO model for Turkey’s passenger car sector. The model includes different powertrains (Gasoline, Diesel, and LPG); different vehicle segments (A, B, C, D, and E) and is applicable to different annual mileages. A vehicle’s ownership cost includes; initial purchase cost, fuel expenses, motor vehicle tax, maintenance cost, and insurances. All of those cost components varies along ownership period, mileage and technical specifications of the vehicle. In this study, 71 different vehicle models were analyzed, taking vehicle sales figures into consideration, over which representative vehicles were specified for each segment and powertrain by median function. Then, a detailed data collection and analysis were made to determine ownership costs for each vehicle segment and powertrain separately. Furthermore, annuity factors were utilized over those variable costs throughout the ownership period. Resale values of vehicles were also considered in different cases. The results show that the TCO in Turkey for conventional vehicles (including LPG) is dominated by taxes. Due to the high automobile purchase taxes, it is observed that the ratio of taxes to sum of TCO for class E vehicles increases up to 55% whereas ownership cost per km rises up to 6 TRY2014/km. The results reveal that for the case of class C with 4 years of ownership with resale, LPG becomes more advantageous over gasoline after 7,500 km annual mileage, whereas the diesel vehicles become economicaly feasible after 20,000 km annual mileage over LPG vehicles. TCO for medium segment vehicles is lower than half of the ownership cost for large segment vehicles due to the high taxes. This taxation policy might explain the tendency towards smaller vehicles in Turkish market. Furthermore, for a customer with an average mileage, LPG vehicles have the lowest costs. Considering the results for different mileages and ownership periods, LPG powered and small segment vehicles seem to dominate the market for a significant time. In the future, the developed model will be extended to include electrified powertrains. With the extended model, the economic advantages or disadvantages of alternative powertrains in Turkish vehicle fleet might be observed.

Item URL in elib:https://elib.dlr.de/98071/
Document Type:Conference or Workshop Item (Speech)
Title:Total Cost of Ownership Analysis for Passenger Cars in Turkey
Authors:
AuthorsInstitution or Email of AuthorsAuthors ORCID iD
Özdemir, Enver Dorukdoruk.oezdemir (at) dlr.deUNSPECIFIED
Tosun, Hasan BasriTosun.Hasan (at) metu.edu.trUNSPECIFIED
Date:27 May 2015
Refereed publication:Yes
Open Access:Yes
Gold Open Access:No
In SCOPUS:No
In ISI Web of Science:No
Status:Published
Keywords:TCO, passenger cars, Turkey, LPG
Event Title:International Association for Energy Economics -IAEE International Conference
Event Location:Antalya, Türkei
Event Type:international Conference
Event Dates:25-27. Mai. 2015
Organizer:IAEE
HGF - Research field:Aeronautics, Space and Transport
HGF - Program:Transport
HGF - Program Themes:Transport System
DLR - Research area:Transport
DLR - Program:V VS - Verkehrssystem
DLR - Research theme (Project):V - Verkehrsentwicklung und Umwelt II (old)
Location: Stuttgart
Institutes and Institutions:Institute of Vehicle Concepts > Fahrzeugsysteme und Technologiebewertung
Deposited By: Özdemir, Doruk
Deposited On:04 Sep 2015 13:50
Last Modified:31 Jul 2019 19:54

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