TITLE:
Development Strategy of New Energy Business for Traditional Car Manufacturers under the Dual-Credit Policy
AUTHORS:
Jing Jin, Shiji Jia, Jiachen Wang, Ying Li
KEYWORDS:
Dual-Credit Policy, Credit Price, New Energy Business, Splitting Strategy, Traditional Car Manufacturers
JOURNAL NAME:
Technology and Investment,
Vol.13 No.4,
September
30,
2022
ABSTRACT: With the track of new energy vehicles continuously
booming and accelerating, more and more automobile manufacturers are seeking
effective methods to help companies stand out. Some of them attempt to split
the new energy vehicle (NEV) business module in order to boost brand
competitiveness for the top spot in an increasingly competitive market. The
dual-credit policy, however, makes Chinese automakers consider whether the
benefits of adopting the splitting strategy exceed the drawbacks, yet few domestic
studies can offer assistance. As a result, the study develops split strategy
and integrative development strategy’s optimal decision models under the
dual-credit policy. The paper also addresses which scenario the Integrative
development approach or the splitting strategy is more advantageous and
effective under using model comparison and numerical analysis. According to the
study, manufacturers of fuel vehicles frequently reduce their output and raise
their prices in response to the dual-credit policy. The credit price should
receive significant attention from both traditional car manufacturers and NEV
manufacturers due to its profound impact on both. Whether traditional car
manufacturers should split the NEV business module independently depends on the
pricing of NEV credits as well as the supply and demand for NEV credits.
Traditional car manufacturers can only use a splitting strategy when the price
of NEV credits is within a particular range and the NEV credit is surplus.