The optimal vehicle product line strategy considering product information disclosure under government carbon regulation

Zhitang Li, Cuihua Zhang, Henry Xu and Ruxia Lyu

Omega, 2023, vol. 119, issue C

Abstract: As customers focus on information disclosure of new energy vehicles and automakers attach great importance to product line strategies under carbon regulation, we study the manufacturer's optimal product line strategy considering product information disclosure under the government's carbon regulation. This study contributes to the emerging vehicle product line area by investigating how manufacturers can establish reasonable vehicle product lines and the impact of different carbon regulation policies on product line strategies. Through comprehensive analyses, we find that the carbon tax rate and carbon trading price affect the revenue of different product lines of the manufacturer and the information disclosure level of products. Importantly, we find that if the valuation (market price) of fuel vehicles is low, manufacturers should adopt a single product line strategy. Conversely, if the valuation (market price) of fuel vehicles is high, manufacturers should adopt a hybrid product line strategy. Moreover, our analyses indicate that when the market valuation of new energy vehicles is high and the valuation of fuel vehicles is low, or when the market valuation of new energy vehicles is low and the valuation of fuel vehicles is moderate, manufacturers prefer to produce new energy vehicle to fuel vehicle. In terms of regret aversion strategies for product line design, our research reveals that a low carbon tax rate (carbon trading price) is beneficial to the fuel vehicle, while a high carbon tax rate(carbon trading price) and high information disclosure cost are beneficial to the revenue of new energy vehicle. Finally, we obtain the automakers’ preferences for carbon regulatory policies through manufacturers’ willingness to disclose information, tax rate and carbon trading price.

Keywords: Product line strategy; Information disclosure; Carbon regulation; New energy vehicles (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0305048323000518
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jomega:v:119:y:2023:i:c:s0305048323000518

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/supportfaq.cws_home/regional
https://shop.elsevie ... _01_ooc_1&version=01

DOI: 10.1016/j.omega.2023.102887

Access Statistics for this article

Omega is currently edited by B. Lev

More articles in Omega from Elsevier
Bibliographic data for series maintained by Catherine Liu ().