On 27th May 2019 (1-2pm) Xinyu Li, postdoctoral researcher at the University Of Groningen, will give a presentation about “Bundling in maintenance contracts” in Q4.245. Afterwards, Mr. Li will be available for questions and discussions. His presentation is part of: https://wiwi.uni-paderborn.de/dep1/me/research/discussing-research/seam/
This paper investigates the owner's choices about whether to procure the maintenance service from single or separate providers for the different stages when the spillover effect between stages, the OEM's learning-by-doing effect, and asymmetry of competition in different markets co-exist. We find that when the competition in the post-warranty market is weak and the effect of learning-by-doing is strong, the owner prefers a bundling contract; otherwise, the owner prefers un-bundling contracts. In addition, un-bundling contracts lead to the ``make a mess for others'' phenomenon that is the OEM intentionally makes a less reliable machine to increase the maintenance costs of other providers.