Evolutionary bi-level model for optimizing ticket fares and operations profit of Taiwan high-speed rail

Abstract

The Taiwan High Speed Rail (THSR) has transformed transportation in western Taiwan. Increasing costs of construction and operation have rendered THSR tickets much more expensive than other forms of transportation. The effects of ticket price benefits on the relevant transportation agency and the distribution of passenger flow have been analyzed to improve the profitability of the THSR. However, relying on analysis of passenger flow information alone may be insufficient to the adjustment of ticket fares. An evolutionary optimization model for maximizing the profits of the transportation agency that considers conflicts between executive decision making and passenger flow was developed herein. To resolve these conflicts, the bi-level planning approach was applied to consider both upper-level and lower-level planning and reflect passenger behavior and transportation profit management. Therefore, developing business plans and strategies that maximize cost efficiency while optimally balancing passenger satisfaction and profitability could improve THSR performance. Results indicated that optimal fare rates should be divided into three groups: 3.1, 3.0, and 4.2 NTD/person-km for long, medium, and short distances, respectively. This tool could be used to model and validate THSR fare adjustments and as a reference for authorities when making policy recommendations.