Selecting the Best-Performing Low-Cost Carrier (LCC) Airlines Using Analytical Hierarchy Process (AHP) and Elimination et Choix Traduisant la Realite (ELECTRE)

Abstract

Background: Low-cost carrier (LCC) is a popular air transportation service as it offers affordable fares. Many airlines have adopted the LCC system because they need to adapt to the changes in the airline industry. The competition is tight. Despite the low cost, consumers demand quality services. Therefore, LCC airlines need to find their competitive edge. Objective: This study aims to determine the best-performing LCC airlines, the criteria, and the sub-criteria to improve the performance. Methods: This study uses two methods from multi-criteria decision-making (MCDM), namely the analytical hierarchy process (AHP) and elimination et choix traduisant la realite (ELECTRE) II. The MCDM is selected for this study because there are four criteria and 21 sub-criteria to evaluate airline performance. The AHP method selects subcriteria that affect airline customer satisfaction. It solves complex problems by establishing a hierarchy. After being assessed by relevant parties, weights or priorities are developed. The results are used to determine the best-performing airline. Meanwhile, the ELECTRE II method ranks the airline’s alternatives. This method is straightforward and widely used in the MCDM. Results: The results indicate that four criteria and 18 sub-criteria affect the performance of LCC airlines in Indonesia. The LCC airline with the best performance is AirAsia, followed by Citilink, Wings Air, and Lion Air. Conclusion: This research integrates the AHP and ELECTRE II methods in evaluating the performance of LCC airlines. This research also provides information about the criteria and sub-criteria to improve airline performance, hence, the customer experience.