Vehicular platooning is a well-known transportation technique that helps reduce fuel consumption, carbon emissions, and road congestion. When integrated with Connected and Autonomous Vehicle (CAV) technologies, platooning enhances the overall safety and efficiency of the transportation system. This article presents Platooning as a Service (PlaaS) platform, a decision-support framework to promote sustainable transportation through platooning. We have formulated this problem as a Stackelberg game, with the platoon service provider (PSP) as the leader and the service users as the followers. The PSP sets the pricing policy, and the follower responds by choosing the distance to be travelled with the platoon. The optimal service contract between the PSP and the follower vehicle is established with the Stackelberg equilibrium, which is derived using Karush-Kuhn-Tucker optimality conditions. Additionally, we have examined the impact of government subsidies on the PlaaS platform in reducing carbon emissions. Our model has been applied to a specific example problem to illustrate the benefits for both players. We have also derived managerial insights through sensitivity analysis, exploring the effect of different velocity levels, vehicle dimensions, government subsidies, and operational urgency on the utilities of the players and CO2 emissions. Our analysis shows that PSP gains a higher profit from high delay-cost vehicles performing time-critical operations with higher platoon velocity. However, the benefits related to fuel consumption are only realized at moderate platoon velocities.

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