Topics in Fractional Airlines

Abstract

Fractional aircraft ownership programs offer companies and individuals all the benefits of owning private jet, such as safety, consistency, and guaranteed availability, at a fraction of the cost of owning an aircraft. In the fractional ownership model, the partial owners of an aircraft are entitled to certain number of hours per year, and the management company is responsible for all the operational considerations and making sure an aircraft is available to the owners at the requested time and location. This thesis research proposes advance optimization techniques to help the management company to optimally operate its available resources and provides tools for strategic decision making. The contributions of this thesis are: (i) The development of optimization methodologies to assign and schedule aircraft and crews so that all flight requests are covered at the lowest possible cost. First, a simple model is developed to solve the crew pairing and aircraft routing problem with column generation assuming that a crew stays with one specific aircraft during its duty period. Secondly, this assumption is partially relaxed to improve resource utilization by revising the simple model to allow a crew to use another aircraft when its original aircraft goes under long maintenance. Thirdly, a new comprehensive model utilizing Benders decomposition technique and a fleet-station time line is proposed to completely relax the assumption that crew stays with one specific aircraft. It combines the fleet assignment, aircraft routing, and crew pairing problems. In the proposed methodologies, real world details are taken into consideration, such as crew transportation and overtime costs, scheduled and unscheduled maintenance effects, crew rules, and the presence of non-crew-compatible fleets. Scheduling with time windows is also discussed. (ii) The analysis of operational strategies to provide decision making support. Scenario analyses are performed to provide insights on improving business profitability and aircraft availability, such as impact of aircraft maintenance, crew swapping, effect of increasing demand by Jet-card and geographical business expansion, size of company owned aircraft, and strategies to deal with the stochastic feature of unscheduled maintenance and demand.