Market competition oriented air-rail ticket fare optimization

Abstract

In the business of intermodal passenger transport, fare optimization of intermodal products has significant effects on corporate revenue and passenger travel convenience. This study takes the competitive relationship between high-speed rail (HSR) and airlines as well as carrier connectivity as the starting point, analyzes the advantages and disadvantages of different carriers in the different markets, and researches the optimization of fares. The stochastic user equilibrium model based on elastic demand is used to establish a bi-level programming model for the optimization of fares; the upper and lower models are solved using the particle swarm algorithm and method of successive averages, respectively. The results suggest that airlines are willing to cooperate with the HSR sector and improve the connectivity between aviation and HSR, and a reasonable pricing strategy is more likely to motivate cooperation between aviation and HSR.