Vehicles manufacturer's pricing strategies considering service level of car-sharing modes

Junxiu Jia (), Luyao Hao (), Shaohua Chen () and Tao Wu
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Junxiu Jia: Xidian University
Luyao Hao: Bao Ji Comprehensive Bonded Zone Affairs Center
Shaohua Chen: Taiyuan University of Technology
Tao Wu: Xidian University

Annals of Operations Research, 2022, vol. 315, issue 2, No 43, 1755-1773

Abstract: Abstract As the era of sharing economy is coming, more and more auto manufacturers begin offering consumers cars for sales and for sharing simultaneously, but consumers have lower acceptance of sharing-cars in China. The key reason is that the availability of sharing-cars, as a service level, has much effect on consumers' time for searching a sharing-car. This study investigates the optimal pricing policies for sharing-cars and cars-for-sale, and reveals how service level affects the manufacturer's optimal decision and modes selection. We find that the hybrid mode should be adopted when consumers' unit time value is in an interval and service level is high. The combined optimal sharing price and sales price can be obtained and they are interralated with each other by key costs and service level in the hybrid mode. And the manufacturer should not introduce sharing-car programs when service level is less than a critical value. Furthermore, observations in numerical analysis show that the sales mode will be completely cannibalized if the sharing service level is much bigger and the optimal prices both first decreases and then increases with a hybrid mode.

Keywords: Sharing-car; Service level and pricing; Search-time; Marginal duration (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1007/s10479-022-04569-8

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