Recycling Performance of the Tire Remanufacturing with Production Capacity Constraints considering Carbon Tax and Technology Subsidy

Abstract

After considering the manufacturer’s production capacity constraints and market preference, this paper presents a closed-loop supply chain of automotive tires which consists of a remanufacturer, a retailer, and a recycler, where used tires are collected and reused. Based on the features of the closed-loop tire remanufacturing supply chain, four Stackelberg models are developed to investigate the influences of the carbon tax and the technology subsidy on recycling performance. The result shows that the carbon tax is conducive to improving the remanufacturing technology level and reducing emissions, but it reduces the profit of the manufacturer and the retailer. A subsidy can make up for their loss by the carbon tax. Moreover, an allied decision of the chain’s members can help them gain economic benefits, while an independent decision can improve environmental benefits.