Dynamic pricing and joint carbon reduction strategies at the production and consumption end in a dual-channel fuel vehicle supply chain

Abstract

This paper investigates carbon reduction in a fuel automotive supply chain. It consists of a manufacturer responsible for carbon reduction and opening an online channel opportunely and a retailer who markets and sells the product through traditional offline channels. Consumers have a preference for low-carbon and low-fuel consumption. It first analyzes decentralized and centralized decision-making under dual channels as a benchmark for comparison. Then, compare the performance of single and dual channels under decentralized decision-making to explore the advantages and conditions of dual channels and link centralized decision-making to reveal the double marginal effect of the supply chain. Finally, it designs a marketing cost-sharing contract to coordinate the behavior of all parties in the supply chain. The results suggest that as long as consumer preference for online channels reaches a certain threshold, dual-channel operation leads to higher double-ended carbon reduction investment, lower prices, and higher total supply chain profits than single-channel, but instead decreases profits for the retailer. Besides, in contrast to decentralized decision-making, marketing cost-sharing contracts can improve profits for all parties in the supply chain, enhance carbon and fuel consumption reduction investment, and partially address the double-marginal effect of the supply chain.