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Developing electric vehicle can reduce crude oil consumption and carbon emission sharply to resolve the problems of energy crisis and climate change of China. EVs require large batteries for energy storage, which affect electric vehicle cost, weight, and performance. More all electric range (AER) means more dispalcement of the fosill fuel, but lead to too expensive to afford for China's consumers. The electric vehicle design method to tadeoff between performance and cost is very valuable.This paper discussed the parameter optimization design method targeting cost-benefit objective. It analyses the impact of maximum speed, AER on energy efficiency and market competitiveness, based the survey data annalysis of vehicle kilometers daily traveled(VKDT), duty cycle analysis, etc.The mathematic model was proposed to account for the effects of additional batteries on fuel consumption, cost, etc. It can be find that when charged daily, AER of 50km or less, in China, using average small-capacity EVs is less expensive and releases fewer GHGs than conventional vehicles (CVs). By cost-benefit analysis, it can be concluded that for the first generation pure electric vehicle, the micro-size electric suitable for the first phase of development.