Association Journal of CSIAM
Supervised by Ministry of Education of PRC
Sponsored by Xi'an Jiaotong University
ISSN 1005-3085  CN 61-1269/O1

Chinese Journal of Engineering Mathematics

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Dynamic Pricing Strategy for the Vehicle Manufacturer under Dual Credit Policy

XU Chao   

  1. School of Modern Post, Xi'an University of Posts and Telecommunications, Xi'an 710061
  • Received:2022-08-04 Accepted:2023-03-29 Published:2025-06-15
  • Supported by:
    The Natural Science Basic Research Program of Shaanxi Province (2022JQ-726); the Scientific Research Program Funded by Shaanxi Provincial Education Department (21JK0920); the Philosophy and Social Science Research Project of Shaanxi Province (2023QN0098).

Abstract:

Consider a vehicle manufacturer selling the fuel vehicle and new energy vehicle during the finite selling horizon. In each period, the firm needs to decide the prices of the fuel vehicle and the new energy vehicle simultaneously. Under the dual credit policy, the firm generates negative credit when producing the fuel vehicle, and generates positive credit when producing the new energy product. Based on the stochastic dynamic programming approach, we propose the dynamic pricing decision model under dual credit policy. Through the theoretical analysis, we prove that the dual credit policy can still promote the popularization of new energy vehicle when firm adopts the dynamic pricing strategy. Besides, the credit of the firm will impact the firm's profit and optimal pricing decisions. When the credit increases, the firm will increase the price of the new energy vehicle, and decrease the price of the fuel vehicle, and the firm’s profit increases. The cost analysis reveals that under the dual credit policy, the firm can expand the sales of new energy vehicle by reducing the manufacturing cost of fuel vehicle and new energy vehicle.

Key words: dual credit policy, fuel vehicle, new energy vehicle, dynamic pricing, stochastic dynamic programming

CLC Number: