Principal-Agent Theory-Based Analysis of China’s Green Automotive Industry Strategies

The automotive industry, as one of China's major energy-consuming sectors, plays a crucial role in carbon emission control. In October 2021, the State Council issued the “Carbon Peaking Action Plan before 2030,” which clearly pointed out that it is necessary to promote the low-carbon transformation of transportation equipment, vigorously promote new energy vehicles, and gradually reduce the consumption of traditional fuel vehicles in new car production and sales as well as the proportion of car ownership. This paper utilizes methods based on the principal-agent theory to quantitatively analyze how the Chinese government accelerates the construction of green transportation infrastructure. It also applies the green and low-carbon concept throughout the entire process of transportation infrastructure planning, construction, operation, and maintenance, aiming to reduce energy consumption and carbon emissions throughout the life cycle. In the end, detailed case studies and observations will be presented.