Transport: The demand for gasoline in Japan to 2020 and new car fuel efficiency

David Bonilla, University of Cambridge

Japanese private vehicle fuel efficiency has not improved significantly since 1989. The objective of the paper is to predict how (1) changes in the car stock, (2) in new car fuel efficiency, (3) in vehicle utilisation and (4) in the macro-economy impact on gasoline demand. By analysis of 12 sets of time series data (1980-02) of Japan’s transport activity, its transport energy demand and its economy we calibrate the demand for gasoline to the year 2020 by private vehicles. Our study is based on several calibrated equations of which estimates feed into the main gasoline demand equations. We predict that gasoline demand increases to 22,000 (terajoules) under the high GDP scenario and declines to 20,000 (terajoules) under the BaU scenario by 2020. We find that actual fuel economy of vehicles is increasingly below test fuel economy of new vehicles. Tested Fuel efficiency is always a key assumption in predicting gasoline demand. Our results also show a weak elasticity of demand for new car fuel efficiency after increases in gasoline price. new vehicle fuel efficiency, utilisation, and the vehicle stock produce estimates of gasoline demand. By including the effect of the vehicle stock, new car fuel efficiency and demographics into a structural model of gasoline demand we improve the validity of the model’s results.

Comments for BIEE Members only.
Sign in or become a member today.

Sign up to our Events Newsletter

To receive email updates about our forthcoming events and news please sign up here.

Sign Up