AbstractThis paper examines individuals motivations when purchasing vehicles, focusing upon what factors would encourage individuals to purchase hybrid electrical vehicle (HEV) or alternatively fuelled vehicle (AFV). AFVs in this paper refer to any cars run on alternatives to petrol and diesel. This research attempts to ascertain whether reductions in fuel costs, vehicle registration tax (VRT), or green house gas emissions would encourage individuals to purchase a HEV or an AFV instead of a conventional vehicle. VRT is an Irish tax that is levied on the purchase of new vehicles. One of the motivations to conduct this research was to examine a new car tax and VRT scheme introduced by the Irish government in 2008. This new policy rewards the purchase of environmentally friendly cars, with lower VRT and car tax rates. To understand individuals’ perceptions of these new taxes a survey was sent to recent customers of a car company in Ireland. The survey asked respondents about their recently purchased vehicle and how important they considered vehicle attributes such as environmental performance, fuel cost, and safety, before making their car purchase. The survey also contained a number of stated preference experiments that were designed to ascertain what factors influence individuals’ decisions when purchasing their new car. The results showed that respondents did not rate green house gas emissions or VRT as crucial attributes when purchasing a new vehicle. The vehicle attributes that respondents rated most highly were reliability, automobile safety, fuel costs, and the cost price. The majority of respondents agreed that HEVs and AFVs are better for the environment, cheaper to run than conventional vehicles and would be the vehicle of choice in ten years time.