Research on home appliance circular design strategy in response to carbon border adjustment mechanism

Abstract

In May 2023, the EU formally adopted the Carbon Border Adjustment Mechanism (CBAM) bill, which requires that from 2026 onwards, high-carbon imports must use the appropriate Carbon Border Adjustment Mechanism (CBAM) certificates. At the initial stage, the mechanism has gradually covered eight high-carbon industries, and is likely to be expanded to include more industries, including the already highly competitive home appliance industry. In order to cope with the challenges that the CBAM may bring, and in line with the general trend of international green trade and circular economy, the government and the international trade industry in multiple categories, including home appliance enterprises, should react quickly and take feasible countermeasures. This study adopts a case study analytical framework to understand the responses of Chinese home appliance enterprises to CBAM through cluster analysis of 240 samples, and to explore the impact of CBAM on individual enterprises, as well as their product development and design strategies in the transition to a carbon-reducing economy. The results show that, firstly, CBAM has both negative and positive impacts on Chinese home appliance firms. Second, four product development strategies were summarized in the cluster analysis, including technological advantage, customer orientation, cost advantage and imitation. Third, 20 strategies related to product cycle design were summarized in the case interviews. In addition, there is a correlation between the product design strategies adopted by the sample firms and the firm attributes (firm size, business form and product development type). The results of this study can provide product design strategy references for the sample companies to deal with CBAM and future competition, as well as practical experience for companies in other fields to deal with CBAM.