Consumer Regret Expectation Market Power And Incentives Policy Of New Energy Vehicle Industry

New energy vehicle industry is an important strategic emerging industry in China.The development of new energy vehicle industry is not only conducive to easing the pressure of energy and environment in China,but also can foster new growth points for economic development.Since the implementation of China’s new energy vehicle subsidy policy,certain effects have been achieved.In order to prevent new energy vehicle manufacturers from relying on subsidies,the government has implemented the subsidy regression policy,but it has caused the sales of new energy vehicles to fall off a cliff.At present,the development of new energy vehicles in China is not mature,and consumers have insufficient understanding of new energy vehicles.It is easy to have regret expectations before buying new energy vehicles,which affects consumers’ purchase decisions and thus affects the market demand for new energy vehicles.At the beginning of the new energy vehicle development,the traditional car makers have market power and occupy a large market share,hinder the new energy into the market,car makers and mature to the development of new energy vehicles,new energy car makers have market power,make traditional car gradually withdraw from the market,the subsidy policy under different market power on the new energy automotive industry incentive effect is different.Therefore,this study focuses on the following issues:considering consumer regret expectations and market power,how should the government formulate incentive policies for the new energy vehicle industry?What is the impact of consumer regret expectation and market forces on incentive policies for new energy vehicles?To answer those questions,on the basis of combing the literature,this study discusses the consumer regret expectations and the market power of new energy vehicles policy incentive mechanism,constructed by the traditional automobile manufacturers and new energy car makers of two-stage game model,analyzes the consideration when consumer expectations of new energy vehicles regret,The incentive effect of production subsidy policy and consumer subsidy policy on the development of new energy automobile industry under the two situations where traditional automobile manufacturers and new energy automobile manufacturers have market power respectively.The main research conclusions of this paper include:(1)The different market power leads to the different game order between traditional automobile manufacturers and new energy automobile manufacturers,which affects the incentive effect of the government’s subsidy policy for new energy automobiles.(2)Consumers’ expectation of regret for new energy vehicles will have a negative impact on the development of the new energy vehicle industry.The existence of expectation of regret reduces the price,market demand and manufacturers’ profits of new energy vehicles.(3)When the traditional car makers have market power,even if consumers expectations of new energy vehicles regret,but increase the intensity of government subsidies on new energy vehicles will still be able to reduce the market advantages of conventional cars,thus improve the new energy vehicles,the optimal price,market demand,manufacturer’s profits and social welfare,reduce consumer regret is expected to bring negative effect.Compared with no new energy vehicle subsidy policy,two kinds of subsidy policies,production subsidy and consumption subsidy,can improve the market demand for new energy vehicles,manufacturers’ profits and social welfare.Among them,the incentive effect of consumer subsidy policy on restraining the traditional automobile industry and promoting the development of new energy vehicle industry is more obvious.(4)When new energy vehicle manufacturers have market power,increasing government subsidies for new energy vehicles can further improve the price of new energy vehicles,market demand,manufacturers’ profits and social welfare,and accelerate the withdrawal of traditional vehicles from the market.Compared with no new energy vehicle subsidy policy,two kinds of subsidy policies,production subsidy and consumption subsidy,can improve the market demand for new energy vehicles,manufacturers’ profits and social welfare.Among them,consumer subsidy has a better incentive effect on further promoting the development of new energy vehicle industry.