Price competition and joint energy‐consumption reduction technology investment of new energy and fuel vehicles under the double‐points policy

Abstract

AbstractThis paper explores for the first time the manufacturers' joint energy reduction strategies for both new energy and fuel vehicles. Assume there is a Cournot car market with differentiated products consisting of one manufacturer producing fuel cars and one manufacturer producing fuel and new energy cars, and a double‐points policy governs them. It shows that the double‐points policy does not necessarily result in a contraction in the fuel vehicle market while leading to a boom in the new energy vehicle market; market competition and consumers' preference for low energy consumption can help incentive manufacturers to reduce vehicle energy consumption.