Joint optimization of charging facility investment and pricing in automobile retail supply chain and coordination

In terms of energy-saving and emission reduction, and the low cost of using new energy vehicles (NEVs), it's expected to have a huge potential market. To gain more market share and meet the increasingly strict emissions regulations, auto manufacturers and distributors as the main stakeholders of the automobile retail supply chain start to make charging facility investments (CFI) to promote the adoption of new energy vehicles (NEVs). However, there is no clearly dominant strategy regarding whether and how the auto manufacturer or the retailer should create a joint optimization between their CFI and pricing strategies. Thus, we investigate a four-stage automobile retail supply chain consisting of the government, one manufacturer, one retailer, and customers. The manufacturer and the retailer contemplate CFI while setting the wholesale and retail prices with consideration of the subsidy policy and the heterogeneous customer value towards NEVs. We use Stackelberg game paradigms to model the interactions between players in the automobile retail supply chain. Besides, we derive the thresholds which determine whether the CFI should be or carried out by the manufacturer or the retailer. We find the retailer has a last-mover advantage to conduct CFI. In addition, the manufacturer or the retailer should abandon CFI by himself to have a lift in certain cases. Furthermore, the manufacturer investment cost-sharing contract is designed to coordinate the automobile retail supply chain to make Pareto optimization. It means both the manufacturer's and the retailer's profits can improve.