Consumers preferences of green vehicles and influence of green innovation towards environmental issues in Malaysia

The use of the green concept in the automotive industry and its practice in supply chain management as an energy-efficient transport innovation, and to improve environmental performance in the automotive industry context have the potential to alleviate environmental issues. Currently, environmental degradation has affected everyone, in which the poor have been more than ever before vulnerable to violent weather, floods, and a changing climate condition. As such, the significance of green technology has become a growing concern, especially in developing countries, because growth has come at the expense of the environment. Therefore, the purpose of the present study is to determine the effect and influence of greening the local automotive industry towards solving environmental issues in Malaysia. In order to achieve this purpose, this study intends to attain three distinct objectives. The first objective is to investigate the willingness to pay (WTP) and preferences among Malaysians in using green vehicles through the choice modelling (CM) and contingent valuation method (CVM) that have been previously used to evaluate the willingness to pay (WTP). The second objective of this study is to predict the customers’ intention to purchase green vehicles, using an extended model of the theory of planned behaviour (TPB). Meanwhile, the third objective of the present study is to examine the influence of greening the suppliers through green innovation towards environmental performance and competitive advantage among local manufacturers in the automotive industry. In achieving these objectives, a sample of 433 respondents through face-to-face interview and an online survey from 150 companies among Malaysian automotive manufacturers was interviewed through an email of questionnaire about green vehicles and green practices. The data were analysed using the Economic Valuation Method for the first objective while the Structural Equation Model (SEM) for both the second and third objectives to verify the significance of the proposed relationship. The result of this study for objective one shows that, Malaysians are willing to pay the price increase in road tax by 6.49% maximum level for non-green vehicles, while the highest marginal value of 36.03% from a range of drivers suggests otherwise where people are concerned about their driving range, showing the preferences towards green vehicles. The findings of the second objective on the other hand, show a significant positive attitude of consumers towards the purchasing of green vehicles. It was also discovered that subjective norm, perceived behavioural control and personal moral norm are also positively influencing the purchase intention of humans, except for habit which is found to be negatively influenced by the purchase intention. Further findings confirm the appropriateness of the TPB model used in this study. Hence, this provides evidence that the extended TPB model has a good explanatory power in predicting consumers’ intention to purchase green vehicles. For the third objective, the study found that greening the supplier through green innovation contributes significantly to the environmental performance while operational and environmental performances have a major effect on the competitive edge of the companies. This study casts light on one of the recent green urban management evaluation mechanisms. The study concludes with the identification of green policy proposals for improving the environmental performance and urban management. This research could be considered as part of the initiatives and guidelines for other ASEAN countries and that it could pave the way to identify appropriate policies to enhance the quality of green city urban systems within the Malaysian context