Effects of Chinese Firms' Innovation on New Energy Vehicles Purchases

Abstract

As energy shortages and environmental pollution intensify, innovation in new energy vehicles is considered a major priority. They present an important opportunity to change the direction of China's automobile industry while reducing greenhouse gas emissions. Following various launches of new energy vehicles, the problem of product homogenization is emerging, and automobile companies are contemplating how to increase their market share. This study investigates a few questions that have been left unanswered in previous research, which are mainly focused on the value and price of new energy vehicles. We focus on the effect of new energy vehicle companies' innovative behaviors on consumers' purchasing intention in the Chinese market. Innovative behaviors are defined here as the rationalization or modernization choices firms make with respect to products, marketing, service, technological, and cultural factors. The study verified the structural equation model constructed using survey data. Our study of 479 surveyed customers shows that consumers' perceived value is positively (+) correlated with a higher degree of innovation by a firm. In general, the relationship between innovation behavior and consumers' perceived risk shows negative results, however, the relationship in this research showed contradictory results. The only negative (-) effects on product purchase were observed in marketing and technological innovation; these factors increase perceived risk by increasing the tendency of consumers to choose to purchase a new energy vehicle despite feeling uneasy about the innovation despite uncertainties about the innovation of new energy vehicles. Our results present the relationship between innovative behaviors of new energy vehicle firms, consumers' perceived value, consumers' perceived risk, consumers' innovative affinities and characteristics, and finally, purchase intention to explore the influence of innovation factors on consumers' purchase intention of new energy vehicles. These findings should assist new vehicle firms in understanding Chinese consumers' purchase intentions.