Optimal choice of power battery joint recycling strategy for electric vehicle manufacturers under a deposit-refund system

Xin Li, Jianbang Du, Pei Liu, Chao Wang, Xiaoqian Hu and Pezhman Ghadimi

International Journal of Production Research, 2023, vol. 61, issue 21, 7281-7301

Abstract: In recent years, worldwide electric vehicle (EV) sales have experienced rapid growth, and recycling an enormous quantity of spent power batteries has become a challenge. This study aims to explore the optimal joint recycling strategy from the EV manufacturer’s perspective by using game theory-based models. The model investigates four kinds of joint recycling strategies: 1) nonalliance (NA) mode, 2) alliance with the power battery manufacturer (APBM) mode, 3) alliance with the third-party recycler (ATPR) mode, and 4) integrated alliance (IA) mode. The results show that: 1) A deposit-refund system can effectively increase the recycling rate. However, an excessive upfront disposal fee will reduce overall profits. 2) For the closed-loop supply chain, the optimal alliance mode depends on the intensity of recycling competition. When recycling competition is fierce, the IA mode is the best alliance mode. When recycling competition is weak, the NA mode is the optimal choice from the recycling rate perspective, and the APBM mode is the optimal choice from the total profit perspective. 3) For the EV manufacturer, the alliance in which its proportion of the extra joint profit is highest tends to be the optimal choice.

Date: 2023
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DOI: 10.1080/00207543.2022.2148009

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