A Time-Based Pricing Game Considering Echelon Utilization in the Battery Leasing Market

Abstract At present, many electric vehicle (EV) companies consider the adoption of a battery leasing model as part of their sales strategy, addressing the issue of higher prices for energy vehicles (EVs) compared to internal combustion engine vehicles (ICEVs) of the same level. In order to enhance the development of the battery leasing model in the EV market, this research explores pricing strategies within the battery supply chain operating under the “battery leasing + echelon utilization” model. Both a Stackelberg and a dynamic system model are proposed with the consideration of echelon utilization. We investigate how the echelon utilization rate, battery quality, and recycling price influence pricing decisions for both battery manufacturers and EV companies. These insights offer guidance for these entities in formulating appropriate pricing strategies. Introducing a long-term repeated game model, we analyze system stability and chaos conditions, the finding from the dynamic model discloses how different behaviors impact the long-term profitability of all parties involved. Furthermore, we propose a chaos control method. Our findings provide valuable managerial insights for battery manufacturers and EV companies.