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Chinese Journal of Management Science ›› 2023, Vol. 31 ›› Issue (8): 122-131.doi: 10.16381/j.cnki.issn1003-207x.2020.1794

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The Research on the Influence of Industrial Policies on Production-decision of Automakers to the COVID-19 Shocking

Jin-huan TANG1,Fang YANG1,Li-wen JIANG2()   

  1. 1.School of Economics and Management, Shenyang Aerospace University, Shenyang 110136, China
    2.College of Economics & Management, Shandong University of Science and Technology, Shandong 266590, China
  • Received:2020-09-17 Revised:2021-05-23 Online:2023-08-15 Published:2023-08-24
  • Contact: Li-wen JIANG E-mail:jiangliwen@sdust.edu.cn

Abstract:

The sudden COVID-19 has brought a huge impact to the auto industry, which has led to a cost premium of supply chain side on the upstream and a shrinking market of demand side on the downstream. So, the auto industry is facing a big challenge. Sensing this, the government, based on the original dual-credit policy, proposed some stimulus policies such as the suspension of the China VI emission standard, the continued subsidy for the purchase of new energy vehicles (NEVs), and so on. In this context, the impact of the parallel implementation of dual-credit policy and subsidy policies on the production decision-making of two types of automakers is analyzed. First, a benchmark model A (before COVID-19) and a model B (after COVID) are formulated. To facilitate the research, the entire market has been taken as a whole, and an extended Hotelling model has been adopted. Then, static and dynamic analysis method is put forward to investigate two things: (i) the impact of the COVID-19 on the prices, demand, revenue, and market share of NEVs and fuel vehicles (FVs) automakers, (ii) the influence of policies and cost premium for the production and pricing strategies are derived. The results show that, the subsidy of government is more favorable to the development of NEVs than FVs to the COVID-19 shocking. Moreover, the dual-credit policy itself have a limited fundamental impact on the revenue of the two types of automakers, but it has a synergistic effect together with the subsidy policy. Besides, with the background of the COVID-19 shocking, NEVs have temporarily obtained a market advantage over fuel-powered vehicles, and this advantage decreases with the reduction of the COVID-19 and has a certain timeliness. This study provides important implications that can be utilized as strategic guidance for government and NEV/FV automakers, and it also meaningful for carbon peak and carbon neutral goal.

Key words: COVID-19 shocking, new energy vehicle, the stimulus polices of government, dual-credit policy, synergistic effect

CLC Number: