A Market Analysis on Green Production Lines Penetrating into Original Equipment Manufacturers (OEMs)

Fierce market competition has been big obstacle in the growth process of sustainable/green production industry. Sustainable production lines often come into play by penetrating into traditional Original Equipment Manufacturers (OEMs). This is due to the high setup cost and opportunity risks. In this study, we look into the scenario when traditional Original Equipment Manufacturers (OEMs) introduce green production lines into their production systems. We want to address the questions whether and how the green production lines can survive in the market competitions. Analyses are conducted between ordinary and green production sectors which produce a similar type of product with different materials and techniques. A game theoretic model is formulated to analyze the competition in the market. Sensitivity analyses and numerical examples can provide suggestions to assist policy makers, government, company executives and consumers to make better and rational decisions