**5. Results**

Figure 7 shows the simulation results of service demand by passenger cars along with historical trends in demand in selected OECD countries in conjunction with GDP per capita. In Figure 7, the simulation results are from the reference case. It is found that the simulation results of service demand by passenger cars are consistent across all scenarios. At maximum across all scenarios and periods, the Best-EI scenario increases service demand for passenger cars 0.16% more than the reference in 2050. That is, all the scenarios do not have a tangible impact on total service demand by passenger cars. It should be noted that all the scenarios assume income elasticity of passenger transportation

demand (α in Equation (7)) as 1.1 for all periods. For example, Dunkerley et al. show that the income elasticity of passenger transportation demand is in the range 0.5 to 1.4 [31].

**Figure 7.** GDP per capita versus demand per capita for passenger cars (source: OECD [32,33]).

Figure 8, which is used for calculating CAFE's performance, shows the market share of ICEVs, BEVs, and FCEVs in the reference case. Since all scenarios do not have a big impact on the overall trend in market share, only the reference results are given in Figure 8. At maximum across all scenarios and periods, market share in 2050 is as follows: Reference (ICEV 9.6%; BEV 26.4%; FCEV 64.0%), Best-EI (ICEV 11.1%; BEV 22.5%; FCEV 66.4%). After the cost parity point (2025), ICEVs' market share is expected to decline rapidly from 70.2% to 21.1% during 2025–2030. Over the same period, FCEVs' market share will grow sharply from 9.8% to 52.1%. A slight increase of BEVs' market share, from 20.0% to 26.8%, will also contribute to shrinking ICEVs' market share.

**Figure 8.** Market share of ICEVs, BEVs and FCEVs; new car penetrations as a percentage of total new passenger car penetrations.

Using their mix scenario, Krause et al. [34] expect that the market share of conventional vehicles will be below 20% in 2050 in the European Union road transportation sector. Bloomberg New Energy Finance [35] foresees South Korea achieving a high level of electric vehicle adoption, representing around 60% of the market share in 2040.

The credit system in South Korea's CAFE standards provides incentives for selling BEVs and FCEVs. However, the credit system can change depending on market circumstances. For example, a sale of one FCEV was counted as five car sales by calculating CAFE's performance until 2017. Now, the credit for one FCEV sale has decreased to three car sales. This means the credit system could be an important variable in assessing CAFE standards. Figure 9 assesses CAFE standards in terms of the energy intensity sensitivity scenarios and also the degree of BEV and FCEV credits. In 2025, if the credit for a BEV or a FCEV sale is one car sale, only the Best-EI scenario will achieve CAFE standards. If the credit for a BEV or an FCEV sale is two car sales, only the reference will not achieve CAFE standards. If the credit for a BEV or a FCEV sale is three car sales, all scenarios will achieve CAFE standards. In 2030, if the credit for one BEV or FCEV sale is one car sale, Better-EI and Best-EI scenarios will achieve CAFE standards. However, if the credit for a BEV or a FCEV is more than two car sales, all scenarios will achieve CAFE standards.

**Figure 9.** Average greenhouse gas (GHG) emissions by scenarios and the degree of credit for BEVs and FCEVs.
