Pricing and Production Flexibility: An Empirical Analysis of the US Automotive Industry

• 成果类型: Article
• 署名作者: Moreno, Antonio; Terwiesch, Christian
• 署名单位: Northwestern University; University of Pennsylvania
• 刊物名称: M&SOM-MANUFACTURING & SERVICE OPERATIONS MANAGEMENT
• ISSN/ISSBN: 1523-4614
• DOI: 10.1287/msom.2015.0534
• 发表日期: 2015
• 页码: 428-444
• 关键词: Empirical Operations Management; flexibility; pricing; automotive industry

摘要

We use a detailed data set from the U.S. auto industry spanning from 2002 to 2009 and a variety of econometric methods to characterize the relationship between the availability of production mix flexibility and firms' use of responsive pricing. We find that production mix flexibility is associated with reductions in observed manufacturer discounts, resulting from the increased ability to match supply and demand. Under the observed market conditions, mix flexibility accounts for substantial average savings by reducing price discounting by approximately 10% of the average industry discount. We test three supplementary hypotheses and find that the reduction in discounts for vehicles manufactured at flexible plants is (1) higher for higher demand uncertainty, (2) higher for vehicles coproduced with vehicles that belong to a different segment, and (3) lower in situations with higher local competition.