How to attract newness-conscious consumers to a circular electric vehicle economy

Abstract

Despite improved energy efficiency and reduced tailpipe air pollutants, electric vehicles (EVs) often encounter skepticism about whether EVs are a sustainable choice because of their waste management issues. The increased adoption of EVs worldwide will keep pushing the industry to adopt circular economy (CE) strategies such as remanufacturing. The study clarifies our understanding of the newness-conscious consumer (NCC) behavior in purchasing remanufactured EV parts. The NCC, which values newness and regards it as a proxy for product quality, is unlikely to be attracted to remanufactured products (RMPs) and constitutes a potentially unpredictable market segment for circular economy practitioners. We examine whether and how improving consumer awareness via green information provision can be pivotal in NCCs' purchasing behavior regarding RMPs in the EV industry. More specifically, we present a model to explain the NCC's purchase intention for remanufactured EV parts with various factors (green certification, perceived trust, perceived value, perceived knowledge of environmental benefits associated with remanufactured EV parts, and price consciousness) that may relate to providing green information. Based on an online survey of 600 participants characterized as NCCs living in Japan, the results of structural equation modeling showed that green certification influenced the NCCs' perception of trust and value regarding RMPs, which could, in turn, explain their purchase intention for remanufactured EV parts. NCCs' price consciousness appears to affect their perception of green certification. Mediation analysis results suggest that NCCs' perceptions of trust, value, and green certification mediate the relationship between their perception of remanufactured EV-related environmental benefits and purchase intention. In addition, we identify whether NCCs are reluctant to buy RMPs due to a lack of reliable green information that shows the value and functionality of remanufacturing. We showed half of the NCC respondents an informational video on RMPs and compared their responses to the remaining half of the group who did not watch it. Independent samples t-test results of the two groups (those with and without information) represented that providing NCCs with information on the functionality of RMPs might promote green purchasing behavior among NCCs. The findings of this study will provide CE practitioners, especially in the EVs industry, with a rich portfolio to cover previously unexplored market segments for remanufacturing.