Research on the Pricing Strategy of New Energy Medium-sized Vehicles Based on Game Theory: Taking Tesla and BYD as Examples

Abstract

In recent years, the demand for new energy vehicles has been increasing. As foreign cars enter the Chinese market, the competition for new energy vehicles in China has become increasingly fierce; inevitably resulting in price wars, but blind price wars will only damage the interests of all parties. This paper uses a static game and a repeated game to analyze how firms can adopt pricing strategies to maximize their benefits. The results show that no matter what the situation is, if a company uses price cuts to capture the market, it may increase its own revenue in the short term, but in the long term, it will cause losses to itself and other companies. Finally, reasonable suggestions are made for new energy vehicle companies facing pricing problems. The research conducted in this paper on pricing can, to a certain extent, enable enterprises to carry out the correct pricing strategy, improve the interests of the enterprises as well as the whole enterprise, and thus promote the development of the new energy vehicle industry.