Roadblocks to fuel-cell electric vehicle diffusion: Evidence from Germany, Japan and California

California’s cap-and-trade program: is it effective in advancing social, economic, and environmental equity?

“…The CVR program ran out of funding in April for 2022, ten months into the fiscal year. These factors contribute to limitations on California’s ability to fully incentivize more EV purchases with cap-and-trade resources, even though the rebate program provides a very efficient and cost-effective use of funds in terms of reducing GHG emissions (Trencher and Wesseling, 2022).…”

Strategies for green industrial and innovation policy–an analysis of policy alignment, misalignment, and realignment around dominant designs in the EV sector *

“…Contextual factors such as changes in public opinion, political shifts (especially in democratic regimes), intragovernmental convergence, and the automakers' level of innovator's dilemma also influence policy realignment. Dominant designs emerge in every industry, and history shows that incumbents and firms that pursued other design choices within a technology or sector invariably had to realign to the dominant design due to changing consumer preferences (Utterback and Abernathy 1975) and compatibility and scaling benefits of aligning to the dominant design (Trencher and Wesseling 2022). However, firms invested in non-dominant designs hesitate to realign for various reasons, including the innovator's dilemma of abandoning their competitive advantage on a different technology (Christensen 1997), deep integration of their component supply chain to a non-dominant design (Ishida et al 2017), and lack of know-how to catch up on the dominant design.…”

“…Several studies in the innovation literature have discussed how governments align and sequence technology-push and demand-pull policies to promote clean energy technologies (Aflaki et al 2021, Grübler 2003, Nemet 2009, Hart and Kallas 2010, Horbach et al 2012, Peters et al 2012, Gallagher 2014, Costantini et al 2015, Zhang and Gallagher 2016, Choi 2018, Nuñez-Jimenez et al 2022, Xin-gang et al 2022. Studies in the strategy and innovation literature have discussed how government and firms respond to the emergence of dominant designs in a technology (Suárez andUtterback 1995, Argyres et al 2015), and specifically in the automobile sector (Choi 2016, Brem and Nylund 2021, Ferrigno et al 2022, Trencher and Wesseling 2022. Ferrigno et al (2022) show how Ford's intense technological experimentation at the turn of 20th century was an important catalyst for the emergence of ICEs as the dominant design and draws parallels to Tesla's efforts to develop the BEV technology and the likely 'innovation shocks' that may have resulted from the same.…”

“…Ferrigno et al (2022) show how Ford's intense technological experimentation at the turn of 20th century was an important catalyst for the emergence of ICEs as the dominant design and draws parallels to Tesla's efforts to develop the BEV technology and the likely 'innovation shocks' that may have resulted from the same. Trencher and Wesseling (2022) looked at the barriers to FCEV diffusion in different countries and concluded that the emergence of BEVs as dominant design, due to the rapid reductions in battery cost and economies of scale, is one of the barriers for FCEV diffusion. Few have studied how governments align or deliberately misalign push and pull innovation policies to pursue green industrial policy strategies to promote technologies such as xEVs.…”

“…The term dominant design comes from the seminal work of Utterback and Abernathy (1975), who define it as the product that emerges from numerous design variations experimented in the early stages of product innovation, effectively moving innovation activities toward process innovations focused on the design (Brem and Nylund 2021) that is accepted as the market standard by competitors and innovators. Dominant designs emerge for various reasons, including consumer preferences (Utterback and Abernathy 1975), compatibility and scaling benefits of a design (Trencher and Wesseling 2022) from technological experimentation (Suárez and Utterback 1995), path dependence (Anderson and Tushman 1990), or when a pioneering new design by a single firm or entrepreneur result in an 'innovation shock' that disrupts the market in an unanticipated way (Argyres et al 2015). As dominant designs emerge, countries that align their innovation policies towards the design gain insuperable cost advantage as returns on investment in cost-reducing process R&D increase with scale (Klepper 1996), which can lead to firstmover advantage.…”