EFFECT OF GOVERNMENT POLICIES AND VEHICLE MARKETING STRATEGIES ON HOUSEHOLD VEHICLE DEMAND AND FUEL CONSUMPTION

The objective of this paper is to develop demand models to forecast ho usehold vehicle demand and corresponding fuel consumption in Jordan. U nderstanding the factors that influence household vehicle quantity hol dings provides a useful tool for developing strategies aimed at curtai ling the contribution of automobiles towards environmental pollution, traffic congestion, and traffic accidents in urban areas. The demand f or automobile and fuel by a household is simultaneously estimated by a joint discrete and continuous choice model. A multinomial legit model is used to examine the number of vehicles owned by a household, where as a multiple regression model is used to predict the amount of fuel c onsumed. A random sample of households from the Greater Amman area is used to estimate demand and choice models. Results suggest that the so cioeconomic characteristics of a household, government policies relati ng to vehicle import duties and vintage, and private sector marketing strategies, all influence a household's decision on the number of vehi cles owned. Results strongly show that households with different vehic le ownership levels respond differently to government policies and car dealers' marketing strategies. Policy makers and transportation plann ers can use the results of this study to forecast the expected demand for used cars, and the increase in the number of new cars, given a set of government and private sector strategies. The results also can be used to predict fuel demand at various levels of household vehicle own ership. Transportation planners can also use these results to assist i n formulating strategies regarding urban road network improvements, an d future demand for public transportation.