Airline Re-Fleeting Managing Revenues and Maintenance Operations

Abstract

Abstract Airline re-fleeting, also known as Demand Driven Dispatch, is the reassignment of aircraft to flights close to departure to improve operating profitability. It swaps aircraft of different sizes on flight legs to change capacity in response to demand. Schedules are usually fixed many months ahead of the departure date, with limited information about demand. Demand driven dispatch makes capacity flexible again, changing aircraft assignments nearer to departure. Using more detailed and reliable demand information to better match capacity supplied with quantity demanded, revenues may be increased and operating costs decreased. Previous research on demand driven dispatch have not incorporated or significantly simplified key issues such as revenue management and maintenance operations; making changes few days in advance to the day of operations may dramatically influence aircraft airworthiness if available flying hours until maintenance are not considered. The focus of this paper is on the integration of demand driven dispatch, revenue management and maintenance operations in an airline network environment. A stochastic mixed integer model is proposed to solve the fleet re-assignment problem while considering aircraft maintenance requirements. Stochastic demand is considered to model demand predictions. Realistic computational experiments drawn from IBERIA, the major Spanish airline, are presented.