Circular business models generation for automobile remanufacturing industry in China

Abstract

Purpose Although China can be considered an early adopter of the circular economy, there are few studies of remanufacturing business models (BMs) in the context of the Chinese automobile industry. The purpose of this paper is to investigate viable BMs, summarizes current obstacles and anticipates future development opportunities and directions. Design/methodology/approach The cross-case analysis considers the roles of value networks and of customer value proposition and interface in circular business models (CBMs) by examining the strategies and tactical measures of two leading remanufacturers. The data are collected from semi-structured interviews, documents, etc. Findings The analysis identifies the following components of viable BMs of remanufacturers: reclaiming raw material, managing used components, producing new products and marketing. Several current obstacles are summarized from four perspectives: policy barriers and insufficient government support; consumer awareness; related product quality; and technology. The study also identifies future directions and opportunities for the automobile parts remanufacturing industry. Originality/value This study contributes to the CBM literature by mapping the barriers and opportunities in remanufacturing. The results have shed some light into the field of sustainability in manufacturing firms by empirically testing the theoretical model. The results will help managers to design viable CBMs in different contexts.

Product Design for Automated Remanufacturing—A Case Study of Electric and Electronic Equipment in Sweden

“…The feedback information (see Figure 3) could be used to design products and components in a way that makes remanufacturing execution much easier, faster, efficient and more inexpensive. Past literature (e.g., [21][22][23][24][25]) has identified several barriers for remanufacturing that include the following: (1) Sufficient volume of the same kind of product is required to be able to run a manufacturing facility. Therefore, a consistent and smooth flow of incoming products for remanufacturing is vital.…”

Business model innovation and growth of manufacturing SMEs: a social exchange perspective

“…Previous studies have suggested that business model innovation is a valuable source of competitive advantage that can lead to superior firm performance (Huang et al , 2013; Visnjic et al , 2016). Elsewhere in the literature (Audretsch et al , 2014; Love and Roper, 2015), business model innovation is seen as a specific type of innovation that is critical to the success of manufacturing firms, and a well-functioning business model is claimed to be a core driver of performance (Shao et al , 2019; Taran et al , 2015). Kim and Min (2015) suggested that asset reconfiguration through adding a new business model creates opportunities for competitive advantage, while Cucculelli and Bettinelli (2015) and Futterer et al (2018) found that modifying the business model in an innovative way has a positive effect on financial performance.…”

“…Yet, as Foss and Saebi (2017, 2018) noted, few studies have provided rigorous evidence of the performance implications of business model innovation, which in turn leaves unanswered the question of whether a change of business model really leads to benefits for the firm. This question is an important one for small- and medium-sized enterprises (SMEs) in manufacturing sectors as they have fewer resources and capabilities to help them mitigate the risks of reinventing and reconstructing their business model (Müller, 2019; Shao et al , 2019). Given the prominent economic contribution of manufacturing SMEs globally (Memili et al , 2015), it is critical to empirically ascertain whether manufacturing SMEs that adopt business model innovation can achieve better performance.…”

Circular production and maintenance of automotive parts: An Internet of Things (IoT) data framework and practice review

“…The interconnectedness of modern industrial and manufacturing enterprises is increasingly realised by their use and deployment of cloud based data collection and analysis systems through IoT (Tao et al, 2014). The automotive sector is strongly moving towards looking at the whole lifecycle aspects of the components used in vehicles and manufacturers increasingly design products for reusability and remanufacture (Shao et al, 2019). Therefore, this paper examines current practice of integrating digital maintenance within production and takes steps towards formulating a digital maintenance framework for automotive manufacturing.…”