lec5_passenger_mix_2003

lec5_passenger_mix_2003 - 1.206J/16.77J/ESD.215J...

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1 .206J/16.77J/ESD.215J    Airline Schedule Planning Cynthia Barnhart Spring 2003  
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11/09/11 Barnhart 1.206J/16.77J/ESD.215J 2 1.206J/16.77J/ESD.215J      The Passenger Mix Problem Outline – Definitions – Formulations – Column and Row Generation – Solution Approach – Results – Applications and Extensions
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11/09/11 Barnhart 1.206J/16.77J/ESD.215J 3 Some Basic Definitions • Market – An origin-destination airport pair, between which  passengers wish to fly one-way • BOS-ORD and ORD-BOS are different • Itinerary – A specific sequence of flight legs on which a passenger  travels from their ultimate origin to their ultimate  destination • Fare Classes – Different prices for the same travel service, usually  distinguished from one another by the set of restrictions  imposed by the airlines
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11/09/11 Barnhart 1.206J/16.77J/ESD.215J 4 Some More Definitions • Spill – Passengers that are denied booking due to  capacity restrictions • Recapture – Passengers that are recaptured back to the  airline after being spilled from another flight  leg
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11/09/11 Barnhart 1.206J/16.77J/ESD.215J 5 Problem Description • Given – An airline’s flight schedule – The unconstrained demand for all itineraries  over the airline’s flight schedule • Objective – Maximize revenues by intelligently spilling  passengers that are either low fare or will most  likely fly another itinerary (recapture) • Equivalent to minimize the total spill costs
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11/09/11 Barnhart 1.206J/16.77J/ESD.215J 6 Example A A B B I,100 J,200 K,100 • One market, 3 itineraries • Unconstrained demand per itinerary – Total demand for an itinerary when the number  of seats is unlimited
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11/09/11 Barnhart 1.206J/16.77J/ESD.215J 7 Example with Capacity  Constraints A A B B I,100,150 J,200,175 K,100,130 • One market, 3 itineraries – Capacity on itinerary I = 150 – Capacity on itinerary J = 175 – Capacity on itinerary K = 130 • Optimal solution: – Spill _____ from I – Spill _____ from J – Spill _____ from K
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11/09/11 Barnhart 1.206J/16.77J/ESD.215J 8 Revenue Management:  A Quick  Look • One flight leg – Flight 105, LGA-ORD, 287 seats available • Two fare classes: – Y: High fare, no restrictions – M: Low fare, many restrictions • Demand for Flight 105 – Y class: 95 with an average fare of $400 – M class:  225 with an average fare of $100 – Optimal Spill Solution (     Y and      M passengers) • Revenue:  $           • Spill:  $
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11/09/11 Barnhart 1.206J/16.77J/ESD.215J 9 Network Revenue Management • Two Flights – Flight 105, LGA-ORD, 287 seats – Flight 201, ORD-SFO, 287 seats • Demand (one fare class) – LGA-ORD, 225 passengers $100 – ORD-SFO, 150 passengers $150 – LGA-SFO, 150 passengers, $225 • Optimal Solution:  $ – LGA-ORD,          passengers  – ORD-SFO,         passengers – LGA-SFO,         passengers
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