A market in transformation: a study on the diffusion of E85 on the Swedish market

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The sales of E85 and flexi-fuel cars have rapidly increased over the last three years. This development has taken place despite the fact that voices have been raised questioning whether ethanol really is sustainable. This contradiction constituted the departure of this thesis. The purpose of this thesis is to explain why E85 has its current market position, and by that potentially develop the understanding of the mechanisms behind the diffusion of a technology. The thesis looks at market factors from an innovation and dominant design perspective. More specifically, the research questions answered in this thesis are: ”Which market factors have affected the diffusion of E85 in Sweden?” and “How have market factors affected the diffusion of E85 in Sweden?”. This thesis takes an explanatory approach, and both qualitative and quantitative data is used. The analysis is conducted by examining 9 summarising analytical questions, which are then summed up to answer the research questions. The factors identified as positively affecting the diffusion of E85 are technological superiority, reproducibility, complementary products, user preferences, economical forces, and government involvement. The factors identified as negatively affecting the diffusion of E85 are technological superiority and user preference...