281. EV Charging Service: Fast Charging or Battery Swapping? Strategic Investment Dilemma
Invited abstract in session TA-53: New Trends in Game Theory IV, stream Game Theory and Mathematical Economics.
Tuesday, 8:30-10:00Room: Liberty Moot Court
Authors (first author is the speaker)
| 1. | Yitong Chen
|
| College of Management and Economics, Tianjin University |
Abstract
In recent years, the growing popularity of electric vehicles (EVs) has led to an increasing demand for public charging infrastructure, especially fast-charging (FC) and battery-swapping (BS) services. The battery-swapping (BS) service, with its three-minute automated quick-recharge capability, has been favored by customers who are highly sensitive to time and seeking premium recharge options. However, due to the limited scale and number of existing BS stations, during high-demand periods, customers have to wait for extended periods, inevitably reducing the overall recharge experience. By analyzing the combined effects of internal technical and operational factors (i.e., the construction costs of FC and BS station) and external market factors (i.e., peak-valley price differences and market expansion), this paper explores strategic options for EV charging service. We establish a service system in which customers experience congestion disutility linearly related to the demand rates, and profit-maximizing EV charging service providers serve customers through FC and/or BS channels. The findings show that while the introduction of BS consistently increases overall sales (i.e., the demand-expansion effect), it also attracts FC customers to the lower-margin BS channel (i.e., the cannibalization effect). Consequently, service providers should strategically introduce BS when the cannibalization effect is relatively small (i.e., when the demand for BS is moderate).
Keywords
- Game Theory
- Service Operations
- Queuing Systems
Status: accepted
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