Airlines Industry Yield Management. Ken Homa

Save this PDF as:
 WORD  PNG  TXT  JPG

Size: px
Start display at page:

Download "Airlines Industry Yield Management. Ken Homa"

Transcription

1 Airlines Industry Yield Management Ken Homa

2 Airlines Industry Challenging Environment Complex, interconnected network Thousands of dynamic prices 90% discount prices 20% pay less than half of average 2/3 s big companies get 35-45% off 50% cancellations 15% no shows

3 Airlines Industry Passenger Info Business / leisure split 50/50 Business: 50% passengers, 60% profits 25% of passengers pay more than 2.5 times average fare Heavy users: top 5% = 40% of trips No brand preference for 50% of leisure and 25% of business travelers

4 Airlines Industry Fundamental Economics Very high investment and fixed costs Equipment & maintenance Computer systems ( reservations) Flight Fixed: fuel, crew, airport fees Low variable cost Agent commissions (8-10% on 85% of volume) In flight food & beverage, incremental handling Empty seats: nil incremental cost Fixed, highly perishable inventory

5 Airlines Industry Low Frills Economics Variablize the fixed costs Source services & personnel Streamline offerings Precisely match segment s value function Accept lower margins Lower relative investment

6 Anybody Remember PeopleExpress? Simple strategy: low frills, low price (Too) rapid expansion No infrastructure (I/T, res system) Very low average cost, but AA killed PeopleExpress AA marginal cost < PE average cost AA attacked with laser fars

7 Available Passenger Miles (APM) Gross measure of capacity Revenue Passenger Miles (RPM) Number of passengers weighted by distance flown Load Factor RPM divided by APM Yield Factor Airlines Industry Performance Metrics Revenue per RPM Fly full with high paying passengers

8 Airlines Marketing Network routing Capacity planning Flight Scheduling Yield Management

9 Network Routings Point to point OD pairs (origin - destination) Originating & continuation flights Hub-and-spoke connections Roughly 2/3 s passengers arriving at a hub connect to other flights

10 Capacity Planning Aggregate Seats and configurations Route-specific Through flight considerations Load factors The performance metric

11 Flight Scheduling Customer preferences Peaks & valleys Connections Planes & crews Disruptions Weather, equipment

12 Yield Management Overbooking Fares Allocation Traffic management Sell as many seats as possible at full fare, then fill otherwise empty seats with discounted fares that exceed variable costs.

13 Jargon Displacement High price customer rejected in favor of low price customer Usually undesirable, but not always Dilution Price insensitive customers pay lower prices Diversion Customer is shifted to an alternative available flight Spillage Customer turned away because of capacity limits Spoilage An empty seat on departure

14 Jargon Cancellation Roughly half of all confirmed reservations are ultimately cancelled No show Roughly 15% of confirmed passengers neither cancel nor show up for the flight Overbooking Accepting more reservations than seat / fare capacity on a flight Oversold Confirmed passengers are denied boarding on a sold out flight

15 Overbooking The No Show Issue On average 15% of confirmed passengers don t show up for a flight Changed plans (without cancellation) Double-booking Spoilage: very high opportunity cost But only on flights with denied reservations Objective: sell-out the flight Take more reservations than capacity in anticipation of no shows

16 Overbooking Overbooking only applies to a portion of all flights Overbooked not the same as oversold Overselling results from stochastic nature of no show pattern

17 Overbooking Costs Volunteer Inducements Rerouting costs Hospitality concessions Loss of goodwill (involuntary denials)

18 Volunteer Inducement Magnitude of inducement Increases with number of seats oversold Ultimate cost depends on the method of fulfilling the incentive Space available negligible cost, except possible fare dilution (to free) Space constrained displacement / opportunity cost unless controlled Credit certificates... Dilutive or stimulative?

19 Rerouting Cost dependent on fulfillment method Space available negligible cost Sold out displacement / opportunity cost 2nd round oversale Competitor flight cash cost (at premium fare)

20 Overbooking The Number Ceiling to limit goodwill impact Estimate (and re-estimate) no show probability function Calculate expected cost of overselling Probability of occurrence Cost of remedial action Calculate expected opportunity cost of possible spoilage Marginal cost = marginal benefit

21 Fares Allocation Pricing Considerations Dilution Price insensitive customers pay lower prices Displacement High price customer rejected in favor of low price customer Usually undesirable, but not always Share Shift Movement of volume among competitive carriers Stimulation New demand in response to lower prices

22 Fares Allocation Fundamentals Fence to minimize dilution Advance purchase, minimum stay, etc. Equalize expected marginal revenue Restrict inventory, nest reservations access Dynamically re-estimate probabilities Link to overbooking policies and to traffic management

23 Traffic Management Maximize system revenue (global optimum) not specific segment (local optimum) Tied to inventory availability (vs. sold out) Can create favorable displacement...

24 Desirable Displacement A to B: full = $100, discount = $50 B to C: full = $250, discount = $125 A to C: full = $350, discount = $175 A to B is full, and B to C is available Accept discount reservation A to C since $175 > $100

25 Yield Management Overbooking Fares Allocation Traffic management Sell as many seats as possible at full fare, then fill otherwise empty seats with discounted fares that exceed variable costs.

26 Airlines Industry Yield Management

Yield Management In The Airline Industry

Yield Management In The Airline Industry Page 1 of 6 Yield Management In The Airline Industry By Frederic Voneche INTRODUCTION Last month on a trip to Brussels from Chicago, I almost had my 8-hour neighbor have a heart attack when I told him

More information

A Look At Cargo Revenue Management

A Look At Cargo Revenue Management White Paper A Look At Cargo Revenue Management A discussion of revenue management for air cargo businesses passenger sales. With the success of In the early 1980s, revenue management disciplines were first

More information

LECTURE - 2 YIELD MANAGEMENT

LECTURE - 2 YIELD MANAGEMENT LECTURE - 2 YIELD MANAGEMENT Learning objective To demonstrate the applicability of yield management in services 8.5 Yield Management or Revenue Management Yield management is applied by service organizations

More information

MIT ICAT. Airline Revenue Management: Flight Leg and Network Optimization. 1.201 Transportation Systems Analysis: Demand & Economics

MIT ICAT. Airline Revenue Management: Flight Leg and Network Optimization. 1.201 Transportation Systems Analysis: Demand & Economics M I T I n t e r n a t i o n a l C e n t e r f o r A i r T r a n s p o r t a t i o n Airline Revenue Management: Flight Leg and Network Optimization 1.201 Transportation Systems Analysis: Demand & Economics

More information

Customer Service Plan. (Issued in Compliance with 14 CFR Part 259)

Customer Service Plan. (Issued in Compliance with 14 CFR Part 259) Customer Service Plan (Issued in Compliance with 14 CFR Part 259) Fiji Airways, in compliance with 14 CFR Part 259, has adopted this customer service plan to monitor the effects of irregular flight operations

More information

Ch 6 Revenue Management

Ch 6 Revenue Management 6-1 Ch 6 Revenue Management 6.1 History 6.2 Levels of Revenue Management 6.3 Revenue Management Strategy 6.4 The System Context 6.5 Booking Control 6.6 Tactical Revenue Management 6.7 Net Contribution

More information

AIRLINE PRICING STRATEGIES IN EUROPEAN AIRLINE MARKET

AIRLINE PRICING STRATEGIES IN EUROPEAN AIRLINE MARKET AIRLINE PRICING STRATEGIES IN EUROPEAN AIRLINE MARKET Ľubomír Fedorco, Jakub Hospodka 1 Summary: The paper is focused on evaluating pricing strategies based on monitoring of air ticket prices in different

More information

Airline Schedule Development

Airline Schedule Development Airline Schedule Development 16.75J/1.234J Airline Management Dr. Peter Belobaba February 22, 2006 Airline Schedule Development 1. Schedule Development Process Airline supply terminology Sequential approach

More information

SIMULATING CANCELLATIONS AND OVERBOOKING IN YIELD MANAGEMENT

SIMULATING CANCELLATIONS AND OVERBOOKING IN YIELD MANAGEMENT CHAPTER 8 SIMULATING CANCELLATIONS AND OVERBOOKING IN YIELD MANAGEMENT In YM, one of the major problems in maximizing revenue is the number of cancellations. In industries implementing YM this is very

More information

Chapter 3 Review QOS QOS RPM. Unit Cost ASM. # Flights RPM. Economies Of Scale. Yield RPM. Operating Expense Revenue. Profit.

Chapter 3 Review QOS QOS RPM. Unit Cost ASM. # Flights RPM. Economies Of Scale. Yield RPM. Operating Expense Revenue. Profit. Chapter 3 Review RPM RPM QOS Elasticity QOS # Flights QOS ASM Unit Cost Unit Cost Demand RPM Time Elasticity Yield Economies Of Scale Price Elasticity Operating Expense Revenue Profit Spill Fundamentals

More information

real-time revenue management

real-time revenue management real-time revenue management Today has been another challenging day. This morning, my manager asked me to close down V class availability in August (apparently increasing average yield is the current management

More information

Saudi Arabian Airlines Customer Service Plan

Saudi Arabian Airlines Customer Service Plan Saudi Arabian Airlines Customer Service Plan This Plan is adopted for all scheduled and public charter flights operated by Saudi Arabian Airlines. Our goal is to make every flight a safe and pleasant experience

More information

Revenue Management in the airline industry: problems and solutions

Revenue Management in the airline industry: problems and solutions Revenue Management in the airline industry: problems and solutions Guillaume Lanquepin-Chesnais supervisors: Asmund Olstad and Kjetil K. Haugen Høgskolen i Molde 23 th November 2012 G.LC (himolde) RM in

More information

Customer Service Plan

Customer Service Plan TAP Portugal s aims to address the key service elements of the new rules put forth by the U.S. Department of Transportation (DOT) that most affect our customers. This Plan applies with respect to TAP Portugal

More information

AIRLINE REVENUE MANAGEMENT IN A CHANGING BUSINESS ENVIRONMENT

AIRLINE REVENUE MANAGEMENT IN A CHANGING BUSINESS ENVIRONMENT Proceedings of the 5 th International Conference RelStat 05 Part 1 AIRLINE REVENUE MANAGEMENT IN A CHANGING BUSINESS ENVIRONMENT Richard Klophaus Trier University of Applied Sciences and Centre of Aviation

More information

This SAS Plan is adopted for all scheduled flights operated by SAS to and from the US.

This SAS Plan is adopted for all scheduled flights operated by SAS to and from the US. SAS Customer Service Plan - 02-02 2012 Scandinavian Airlines System (SAS) s Customer Service Plan describes SAS s customer service commitments consistent with US Department of Transportation regulations.

More information

DEMYSTIFYING PRICE OPTIMIZATION:

DEMYSTIFYING PRICE OPTIMIZATION: HOSPITALITY Alex Dietz DEMYSTIFYING PRICE OPTIMIZATION: A REVENUE MANAGER S GUIDE TO PRICE OPTIMIZATION As analytic approaches to pricing have evolved over the last decade, one of the most common questions

More information

OR Applications in the Airline Industry

OR Applications in the Airline Industry Connecting people with the world s greatest travel possibilities. OR Applications in the Airline Industry Anand Srinivasan Who is Sabre Holdings? A world leader in travel commerce, retailing travel products,

More information

Service Management Managing Capacity

Service Management Managing Capacity Service Management Managing Capacity Univ.-Prof. Dr.-Ing. Wolfgang Maass Chair in Economics Information and Service Systems (ISS) Saarland University, Saarbrücken, Germany WS 2011/2012 Thursdays, 8:00

More information

Chapter 15: Pricing and the Revenue Management

Chapter 15: Pricing and the Revenue Management Chapter 15: Pricing and the Revenue Management 1 Outline The Role of RM (Revenue Management) in the SCs RM for Multiple Customer Segments RM for Perishable Assets RM for Seasonable Demand RM for Bulk and

More information

Customer Service Plan

Customer Service Plan Customer Service Plan Concesionaria Vuela Compañía de Aviación, S.A.P.I. de C.V., d/b/a Volaris, seeks to reach our Customers satisfaction and offer them a unique flight experience. This is the reason

More information

36106 Managerial Decision Modeling Revenue Management

36106 Managerial Decision Modeling Revenue Management 36106 Managerial Decision Modeling Revenue Management Kipp Martin University of Chicago Booth School of Business October 5, 2015 Reading and Excel Files 2 Reading (Powell and Baker): Section 9.5 Appendix

More information

Airline Reservation Systems. Gerard Kindervater KLM AMS/RX

Airline Reservation Systems. Gerard Kindervater KLM AMS/RX Airline Reservation Systems Gerard Kindervater KLM AMS/RX 2 Objective of the presentation To illustrate - what happens when passengers make a reservation - how airlines decide what fare to charge to passengers

More information

Yield Management. B.S.c. Thesis by. Márta Treszl. Mathematics B.S.c., Mathematical Analyst. Supervisors: Róbert Fullér.

Yield Management. B.S.c. Thesis by. Márta Treszl. Mathematics B.S.c., Mathematical Analyst. Supervisors: Róbert Fullér. Yield Management B.S.c. Thesis by Márta Treszl Mathematics B.S.c., Mathematical Analyst Supervisors: Róbert Fullér Professor at Åbo Akademi University Viktória Villányi Assistant Professor at the Department

More information

Revenue Management. Who I am...

Revenue Management. Who I am... (Approximate) Dynamic Programming in Revenue Management Christiane Barz Anderson School of Business Gold Hall B520 February 14th 2012 Who I am... - Diploma and PhD in Industrial Engineering from Universität

More information

EASYJET TRADING STATEMENT FOR THE QUARTER ENDED 31 DECEMBER 2014

EASYJET TRADING STATEMENT FOR THE QUARTER ENDED 31 DECEMBER 2014 27 January 2015 easyjet Trading Statement Page 1 of 7 A. HIGHLIGHTS: EASYJET TRADING STATEMENT FOR THE QUARTER ENDED 31 DECEMBER 2014 Drive demand, conversion and yields across Europe Seats flown grew

More information

Airline Marketing: An Overview

Airline Marketing: An Overview Airline Marketing: An Overview Air Transport Management Seminar Universidade Lusofona Lisbon 7th - 11th January 2008 Dr Keith Mason Director Business Travel Research Centre www.businesstravelresearch.com

More information

Fare Class Codes A A. C C Full Fare Business Class (not used by Virgin Atlantic) D D Discounted Upper Class

Fare Class Codes A A. C C Full Fare Business Class (not used by Virgin Atlantic) D D Discounted Upper Class Fare Class Codes A A Virgin Atlantic does not operate a First Class cabin, instead it operates Upper Discounted First Class (not Class as a J-Class (Premium Business) for its top tier of travel. used by

More information

AirAsia.com. Professional Diploma Program in Logistics and Supply Chain Management Project Studies Enabling Technology in Airline Industry

AirAsia.com. Professional Diploma Program in Logistics and Supply Chain Management Project Studies Enabling Technology in Airline Industry AirAsia.com Professional Diploma Program in Logistics and Supply Chain Management Project Studies Enabling Technology in Airline Industry By WONG Pui Man, Cary March 2009 2 CONTENTS CONTENTS...2 ABSTRACT...3

More information

*This information brochure has been issued pursuant to provisions of EC 261/2004 Regulation of the European Parliament and European Union Council.

*This information brochure has been issued pursuant to provisions of EC 261/2004 Regulation of the European Parliament and European Union Council. TURKISH AIRLINES COMPENSATION AND SERVICE SYSTEM that will provided to our Customers in case of Denied Boarding*, Flight Cancellations and Long Delays in Turkish Airlines flights departing from EU countries

More information

Dealing with flight disruption

Dealing with flight disruption Dealing with flight disruption Guide to dealing with flight disruption The following guide offers practical information about what you re entitled to if your flight is delayed or cancelled, your legal

More information

Keywords revenue management, yield management, genetic algorithm, airline reservation

Keywords revenue management, yield management, genetic algorithm, airline reservation Volume 4, Issue 1, January 2014 ISSN: 2277 128X International Journal of Advanced Research in Computer Science and Software Engineering Research Paper Available online at: www.ijarcsse.com A Revenue Management

More information

What s Wrong with the Airline Industry? Diagnosis and Possible Cures. Statement of

What s Wrong with the Airline Industry? Diagnosis and Possible Cures. Statement of What s Wrong with the Airline Industry? Diagnosis and Possible Cures Statement of Steven A. Morrison Professor and Chair, Department of Economics Northeastern University Boston, MA 02115 617-373-2873 s.morrison@neu.edu

More information

PROS ORIGIN & DESTINATION REVENUE MANAGEMENT III

PROS ORIGIN & DESTINATION REVENUE MANAGEMENT III PROS ORIGIN & DESTINATION REVENUE MANAGEMENT III The most advanced network revenue management solution in the world. Unlock Your Data Unleash Your Sales As you expand your network, the pressure to maximize

More information

Amadeus Business Intelligence Portfolio. Business Management. Don t just guess! be sure

Amadeus Business Intelligence Portfolio. Business Management. Don t just guess! be sure Business Management Don t just guess! be sure More than data: the power to make informed decisions Is speed to market enough? It s no longer news, but it deserves to be repeated again and again: the world

More information

Airline Economics Chapter 3

Airline Economics Chapter 3 Airline Economics Chapter 3 SYST 461/660 OR 750 Spring 2010 Sources: The Global Airline Industry Peter Belobaba, Amedeo Odoni, Cynthia Barnhart, MIT, Library of Flight Series Published by John Wiley &

More information

BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C. --

BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C. -- BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C. -- Essential air service at Docket DOT-OST-25-2734 PROPOSAL OF COLGAN AIR, INC. TO PROVIDE SUBSIDIZED ESSENTIAL AIR SERVICE FOR THE COMMUNITY OF

More information

Low-Cost Carriers in the Airline Industry: An In-Depth Analysis of Southwest Airlines, JetBlue Airways and EasyJet Airlines

Low-Cost Carriers in the Airline Industry: An In-Depth Analysis of Southwest Airlines, JetBlue Airways and EasyJet Airlines Dvorkin 1 Low-Cost Carriers in the Airline Industry: An In-Depth Analysis of Southwest Airlines, JetBlue Airways and EasyJet Airlines Diana Dvorkin MS2103 Operations Management Individual Assessment of

More information

Principles of demand management Airline yield management Determining the booking limits. » A simple problem» Stochastic gradients for general problems

Principles of demand management Airline yield management Determining the booking limits. » A simple problem» Stochastic gradients for general problems Demand Management Principles of demand management Airline yield management Determining the booking limits» A simple problem» Stochastic gradients for general problems Principles of demand management Issues:»

More information

MATERIALS MANAGEMENT. Module 9 July 22, 2014

MATERIALS MANAGEMENT. Module 9 July 22, 2014 MATERIALS MANAGEMENT Module 9 July 22, 2014 Inventories and their Management Inventories =? New Car Inventory Sitting in Parking Lots Types of Inventory 1. Materials A. Raw material B. WIP C. Finished

More information

Wong 1. accessed 29 Nov 2010. 1 Malcolm Tatum, What is an Online Auction?, http://www.wisegeek.com/what-is-an-online-auction.htm,

Wong 1. accessed 29 Nov 2010. 1 Malcolm Tatum, What is an Online Auction?, http://www.wisegeek.com/what-is-an-online-auction.htm, Wong 1 Angel Hoi Ling Wong (UID: 303577059) Econ 106T Professor Board 2 December 2010 Priceline: Name Your Own Price Introduction Priceline.com ( Priceline ) is an e-commerce company that primarily provides

More information

EASYJET TRADING STATEMENT FOR THE QUARTER ENDED 30 JUNE 2015

EASYJET TRADING STATEMENT FOR THE QUARTER ENDED 30 JUNE 2015 22 July 2015 easyjet Trading Statement Page 1 of 6 A. HIGHLIGHTS: EASYJET TRADING STATEMENT FOR THE QUARTER ENDED 30 JUNE 2015 easyjet performance in the quarter Good commercial performance with revenue

More information

THE AMERICAN AIRLINEW INDUSTRY AND SOUTHWEST AIRLINES. low profit margins. Within the industry, however, there have been differences in terms of

THE AMERICAN AIRLINEW INDUSTRY AND SOUTHWEST AIRLINES. low profit margins. Within the industry, however, there have been differences in terms of THE AMERICAN AIRLINEW INDUSTRY AND SOUTHWEST AIRLINES Introduction The domestic airline industry in the USA has been characterized by intense rivalry and low profit margins. Within the industry, however,

More information

Pricing of Transportation Services: Theory and Practice II

Pricing of Transportation Services: Theory and Practice II Pricing of Transportation Services: Theory and Practice II Moshe Ben-Akiva 1.201 / 11.545 / ESD.210 Transportation Systems Analysis: Demand & Economics Fall 2008 Review and Outline Review of Previous Lecture:

More information

PASSENGER RIGHTS. For further information, please refer to and

PASSENGER RIGHTS. For further information, please refer to  and PASSENGER RIGHTS Dear Passengers, In case of any denied boarding, flight cancellation or delay of a flight for a period of at least two hours, you can benefit from the rights prescribed in relation to

More information

PRESS RELEASE. Nine Month 2015 Financial Results. Net earnings of 81.9m Consolidated revenue up 8% 17% rise in traffic to more than 9m passengers

PRESS RELEASE. Nine Month 2015 Financial Results. Net earnings of 81.9m Consolidated revenue up 8% 17% rise in traffic to more than 9m passengers PRESS RELEASE Nine Month 2015 Financial Results Net earnings of 81.9m Consolidated revenue up 8% 17% rise in traffic to more than 9m passengers Kifissia, 26 November 2015 AEGEAN announces Nine Month 2015

More information

CONDITIONS OF CONTRACT

CONDITIONS OF CONTRACT NOTICE : if the passenger s journey involves an ultimate destination or stop in a country other than the country of departure the Warsaw Convention may be applicable and the Convention governs and in most

More information

The Airline Industry Since 9/11: Overview of Recovery and Challenges Ahead

The Airline Industry Since 9/11: Overview of Recovery and Challenges Ahead The Airline Industry Since 9/11: Overview of Recovery and Challenges Ahead Dr. Peter P. Belobaba MIT Global Airline Industry Program Washington, DC March 26, 2002 Outline Airline Performance 2001 Weakening

More information

Airline Fleet Planning Models. 16.75J/1.234J Airline Management Dr. Peter P. Belobaba April 10, 2006

Airline Fleet Planning Models. 16.75J/1.234J Airline Management Dr. Peter P. Belobaba April 10, 2006 Airline Fleet Planning Models 16.75J/1.234J Airline Management Dr. Peter P. Belobaba April 10, 2006 Lecture Outline Fleet Planning as part of Strategic Planning Process Airline Evaluation Process Approaches

More information

Introduction to Airline Management

Introduction to Airline Management Chapter 1 Introduction to Airline Management Introduction Aviation provides the only transportation network across the globe and it is crucial for global business development and tourism enrichment. Air

More information

Scandinavian Airlines System (SAS) s Customer Service Plan describes SAS s customer service

Scandinavian Airlines System (SAS) s Customer Service Plan describes SAS s customer service SAS Customer Service Plan - 12-15-2015 Scandinavian Airlines System (SAS) s Customer Service Plan describes SAS s customer service commitments consistent with US Department of Transportation regulations.

More information

PRICE DISCRIMINATION IN TRANSPORT BUSINESS

PRICE DISCRIMINATION IN TRANSPORT BUSINESS Alexander STETJUHA PRICE DISCRIMINATION IN TRANSPORT BUSINESS Abstract The work investigates the possibilities of price discrimination employment in the transport industry. The investigation is based on

More information

Revenue Management : Pricing : Scheduling : Consulting

Revenue Management : Pricing : Scheduling : Consulting Revenue Management : Pricing : Scheduling : Consulting Air Cargo 60 35% 32 3.5 Is a USD 60 billion business _ Transports 35% of the value of goods traded internationally _ Supports 32 million jobs _ USD

More information

Discussion Paper 01: Aviation Demand Forecasting

Discussion Paper 01: Aviation Demand Forecasting Airports Commission Discussion Paper 01: Aviation Demand Forecasting Response from Kent County Council and Medway Council Q1: To what extent do you consider that the DfT forecasts support or challenge

More information

Cities of Dallas and Fort Worth, Texas Dallas/Fort Worth International Airport Joint Revenue Refunding Bonds, Series 2014D (AMT)

Cities of Dallas and Fort Worth, Texas Dallas/Fort Worth International Airport Joint Revenue Refunding Bonds, Series 2014D (AMT) U.S. Public Finance Airport Rating Report Cities of Dallas and Fort Worth, Texas Dallas/Fort Worth International Airport Joint Revenue Refunding Bonds, Series (AMT) Analytical Contacts: Harvey Zachem,

More information

Improved Forecast Accuracy in Airline Revenue Management by Unconstraining Demand Estimates from Censored Data by Richard H. Zeni

Improved Forecast Accuracy in Airline Revenue Management by Unconstraining Demand Estimates from Censored Data by Richard H. Zeni Improved Forecast Accuracy in Airline Revenue Management by Unconstraining Demand Estimates from Censored Data by Richard H. Zeni ISBN: 1-58112-141-5 DISSERTATION.COM USA 2001 Improved Forecast Accuracy

More information

Reservations, Ticketing & Integrity Policy for the SAS Group airlines.

Reservations, Ticketing & Integrity Policy for the SAS Group airlines. Reservations, Ticketing & Integrity Policy for the SAS Group airlines. The objective of this Reservations, Ticketing & Integrity Policy is to advise Travel Agents (IATA and Non- IATA Agents) on how to

More information

MAXIMIZING AIRLINE PROFITABILITY

MAXIMIZING AIRLINE PROFITABILITY MAXIMIZING AIRLINE PROFITABILITY IEMS 310 Jierong Pan Chirag Sabunani Zavia Zhe Wang Background & Objective: Westjet is Airlines is Canada s leading low cost airlines, operating Boeing 737 flights that

More information

CHAPTER 19 (FIN MAN); CHAPTER 4 (MAN) COST BEHAVIOR AND COST-VOLUME-PROFIT ANALYSIS

CHAPTER 19 (FIN MAN); CHAPTER 4 (MAN) COST BEHAVIOR AND COST-VOLUME-PROFIT ANALYSIS (FIN MAN); CHAPTER 4 (MAN) COST BEHAVIOR AND COST-VOLUME-PROFIT ANALYSIS 1. Total variable costs change in proportion to changes in the level of activity. Unit variable costs remain the same regardless

More information

Optimization in Airline Scheduling: Challenges and Successes

Optimization in Airline Scheduling: Challenges and Successes Optimization in Airline Scheduling: Challenges and Successes Ellis L. Johnson First TLI-AP NTNU Workshop on Multi-Modal Modal Logistics National University of Singapore 11 March 2002 2 TLI-AP NTNU NUS

More information

Charter Services. Frequently Asked Questions

Charter Services. Frequently Asked Questions Charter Services Frequently Asked Questions What advantages does chartering a private airplane have over traveling with the commercial airlines? Chartering a private aircraft provides you with numerous

More information

Customer Service Plan

Customer Service Plan 1- Offering the lowest fare available. At Sun Country Airlines, our representatives have been trained and our online website technology is programmed to quote the lowest airfare available at the time of

More information

AD 75/50 AGENCY REDUCED RATE AUTHORIZATION PROGRAM 2016 FLYING ON LH, OS AND LX FLIGHTS ONLY

AD 75/50 AGENCY REDUCED RATE AUTHORIZATION PROGRAM 2016 FLYING ON LH, OS AND LX FLIGHTS ONLY AD 75/50 AGENCY REDUCED RATE AUTHORIZATION PROGRAM 2016 FLYING ON LH, OS AND LX FLIGHTS ONLY PARTICIPATING CARRIERS In Economy and Business Class, AD75/50 promotion codes entitle qualified agency personnel

More information

The Truth about Finding the Lowest Airfare

The Truth about Finding the Lowest Airfare The Truth about Finding the Lowest Airfare My employees tell me they can find lower airfares on the Internet 2011 Hurley Travel Experts, Inc. Reproduction Prohibited. This paper includes data that shall

More information

(Identifying the $3 CPM Trip)

(Identifying the $3 CPM Trip) (Identifying the $3 Trip) Whitepaper Series A Primer on the Business Aviation Industry Understanding Business Aviation s Costs The True Cost of Commercial Air Travel Analyzing Your Air Travel Budget For

More information

Participant_s Tour Contract - May 2014 (v3) (FINAL).doc

Participant_s Tour Contract - May 2014 (v3) (FINAL).doc Vacations-Hawaii AIR CHARTER - PARTICIPANT S TOUR CONTRACT The participant acknowledges receiving, reading, and agreeing to the terms and conditions set forth below covering the charter to be operated

More information

ATB Financial Travel & Entertainment Policy

ATB Financial Travel & Entertainment Policy ATB Financial Travel & Entertainment Policy Table of Contents 1. Purpose... 1 2. Scope... 1 3. General... 2 4. Definitions... 2 5. Travellers Responsibilities... 3 6. Booking Travel... 3 7. Accountability

More information

INTEGRATING CASE STUDY 9 The Art of Devising Airfares

INTEGRATING CASE STUDY 9 The Art of Devising Airfares INTEGRATING CASE STUDY 9 The Art of Devising Airfares Salvatore s Managerial Economics: Principles and Worldwide Applications, 8th International Edition Chapter 11-2: The Art of Devising Air Fares Introductory

More information

Network of International Business Schools

Network of International Business Schools Network of International Business Schools WORLDWIDE CASE COMPETITION Sample Case Analysis #2 Qualification Round submission from the 2015 NIBS Worldwide Case Competition, Ottawa, Canada Case: Ethiopian

More information

Airline Disruption Management

Airline Disruption Management Airline Disruption Management In a world of crowded planes and crowded skies, and where operational problems are quickly magnified by tight systemic constraints, one of the few ways airlines can truly

More information

NORWEGIAN AIR SHUTTLE ASA QUARTERLY REPORT FOURTH QUARTER 2003

NORWEGIAN AIR SHUTTLE ASA QUARTERLY REPORT FOURTH QUARTER 2003 NORWEGIAN AIR SHUTTLE ASA QUARTERLY REPORT FOURTH QUARTER 2003 FOURTH QUARTER AND 2003 IN BRIEF On 18 December Norwegian s shares was listed on the Oslo Stock Exchange, after acquiring NOK 250 million

More information

Revenue Management with Customer Choice Modeling and Dependent Demand Forecasting

Revenue Management with Customer Choice Modeling and Dependent Demand Forecasting Revenue Management with Customer Choice Modeling and Dependent Demand Forecasting Anne Mercier Senior Scientist IATA Commercial Strategy Symposium Istanbul, Turkey December 9, 2010 Revenue Management with

More information

Group D: FAA Landing Slots. Elaine Ou Jeff Shneidman Allan Sumiyama

Group D: FAA Landing Slots. Elaine Ou Jeff Shneidman Allan Sumiyama Group D: FAA Landing Slots Elaine Ou Jeff Shneidman Allan Sumiyama Airplane World Different (easier?) than FCC: Transparency. Every 10 th ticket known. Costs known. Load factors known. Different (harder?)

More information

FRAConnect Incentive program

FRAConnect Incentive program FRAConnect Incentive program Long-term incentives for long-term growth Kolumnentitel 1 FRAConnect The passenger growth and sustainability program at Frankfurt Airport Sustainable growth is healthy growth.

More information

REVENUE MANAGEMENT IN THE TRAVEL INDUSTRY

REVENUE MANAGEMENT IN THE TRAVEL INDUSTRY REVENUE MANAGEMENT IN THE TRAVEL INDUSTRY WARREN LIEBERMAN Veritec Solutions Belmont, California Yield Management 1 could easily turn out to be the most important pricing breakthrough of the 20 th Century

More information

AAA Corporate Travel Newsletter January 30 th, 2015

AAA Corporate Travel Newsletter January 30 th, 2015 AAA Corporate Travel Newsletter January 30 th, 2015 Concur Travel New User Interface goes live January 31 On January 31, Concur will officially transition your Concur Travel site to their NEW User Interface,

More information

Your Guide To Book Flights on LHGroup-agent.com. Seite 1

Your Guide To Book Flights on LHGroup-agent.com. Seite 1 Your Guide To Book Flights on LHGroup-agent.com Seite 1 Table Of Content Booking - Advance Seat Reservation (ASR)... 16 Booking - Corporate Fares on LHGroup-Agent.com... 17 Booking - Payment... 13 Expanded...

More information

Warren Lieberman is recognized as one of the world s leaders in non-traditional implementations

Warren Lieberman is recognized as one of the world s leaders in non-traditional implementations GETTING THE MOST FROM REVENUE MANAGEMENT By Warren H. Lieberman Veritec Solutions 824 Miramar Terrace Belmont, CA 94002 U.S.A. Tel: +1 650-620-0000 Email: warren@veritecsolutions.com About the Author Warren

More information

Data Integrity in Travel Management Reporting

Data Integrity in Travel Management Reporting The travel management reports produced by back office systems and third-party reporting tools are often plagued with omissions, errors and inconsistencies. Although the output of a system is generally

More information

EASYJET TRADING STATEMENT FOR THE QUARTER ENDED 31 DECEMBER 2015

EASYJET TRADING STATEMENT FOR THE QUARTER ENDED 31 DECEMBER 2015 26 January 2016 easyjet Trading Statement Page 1 of 6 EASYJET TRADING STATEMENT FOR THE QUARTER ENDED 31 DECEMBER 2015 Continued robust commercial performance and strong management action on cost delivers

More information

MEMBERSHIP, ENTERING INTO AN AGREEMENT AND RESPONSIBILITIES OF THE COMPANY

MEMBERSHIP, ENTERING INTO AN AGREEMENT AND RESPONSIBILITIES OF THE COMPANY GENERAL These terms and conditions shall apply to the Finnair Corporate Programme (hereinafter Programme ). Apart from these terms and conditions, no other rules are applicable. The Programme is designed

More information

OPTIMIZING YOUR WORLD REVENUE TECHNOLOGY SERVICES. Revenue Management. for. Cruise Ferries

OPTIMIZING YOUR WORLD REVENUE TECHNOLOGY SERVICES. Revenue Management. for. Cruise Ferries OPTIMIZING YOUR WORLD REVENUE TECHNOLOGY SERVICES Revenue Management for Cruise Ferries Revenue Management in Cruise Ferry Industry Revenue Management in the cruise ferry industry is beginning to get recognition

More information

Restructuring the Revenue Management System of North Star Airlines North Star Airlines is a medium-sized airline company serving eight major cities

Restructuring the Revenue Management System of North Star Airlines North Star Airlines is a medium-sized airline company serving eight major cities Restructuring the Revenue Management System of North Star Airlines North Star Airlines is a medium-sized airline company serving eight major cities in the United States. Since it was established in 1993,

More information

2006 Report Card for Pennsylvania s Infrastructure

2006 Report Card for Pennsylvania s Infrastructure AVIATION C- 2006 Report Card for Pennsylvania s Infrastructure Philadelphia International Airport (PHL) is currently one of the fastest growing airports in the world. It is also one of the most delay-prone

More information

Your Air. Passenger Rights. Traveller s Guide. How to choose. What to do when. suitable tariff airplane company

Your Air. Passenger Rights. Traveller s Guide. How to choose. What to do when. suitable tariff airplane company Traveller s Guide Your Air Passenger Rights European Consumer Centre Czech Republic Štěpánská 15, 120 00 Praha 2 phone: +420 296 366 155 esc@coi.cz, www.coi.cz/esc How to choose suitable tariff airplane

More information

Yield Management in the Railroad Industry Supporting Supply Chain Partnerships

Yield Management in the Railroad Industry Supporting Supply Chain Partnerships Yield Management in the Railroad Industry Supporting Supply Chain Partnerships November 14, 2011 Jason Kuehn Associate Partner INFORMS Conference, Charlotte, NC Surface Transportation Section 1 CAPITAL

More information

Jetstar Customer Service Plan - United States

Jetstar Customer Service Plan - United States Jetstar Customer Service Plan - United States We are Australia's leading low fare airline dedicated to offering you everyday low fares to enable more people to fly more places more often. We also aim to

More information

Alliances. Compete. Re-evaluation

Alliances. Compete. Re-evaluation STRATEGIC OVERVIEW ANA ANNUAL REPORT 1998 Domestic Air Transportation Attract Load factor is critical to ANA s earnings. In fiscal 1998, this figure was 63.4 percent in Japan. If fares remain constant,

More information

FREQUENTLY ASKED QUESTIONS REGARDING CITY NATIONAL REWARDS, POWERED BY THE SCORECARD PROGRAM EFFECTIVE MAY 7, 2012

FREQUENTLY ASKED QUESTIONS REGARDING CITY NATIONAL REWARDS, POWERED BY THE SCORECARD PROGRAM EFFECTIVE MAY 7, 2012 FREQUENTLY ASKED QUESTIONS REGARDING CITY NATIONAL REWARDS, POWERED BY THE SCORECARD PROGRAM EFFECTIVE MAY 7, 2012 GENERAL PROGRAM QUESTIONS What is City National Rewards? What is ScoreCard? How do I enroll

More information

MSc in Tourism Transport and Environmental Economics REVENUE MANAGEMENT IN THE FLIGHT INDUSTRY. EVIDENCE OF SOME TOURIST MARKETS TO GRAN CANARIA.

MSc in Tourism Transport and Environmental Economics REVENUE MANAGEMENT IN THE FLIGHT INDUSTRY. EVIDENCE OF SOME TOURIST MARKETS TO GRAN CANARIA. UNIVERSIDAD DE LAS PALMAS DE GRAN CANARIA MSc in Tourism Transport and Environmental Economics REVENUE MANAGEMENT IN THE FLIGHT INDUSTRY. EVIDENCE OF SOME TOURIST MARKETS TO GRAN CANARIA. Matías Sosa Breyer

More information

Aviation Market Stimulus Program

Aviation Market Stimulus Program ATTACHMENT A City and County of San Francisco Airport Commission Aviation Market Stimulus Program C:\Documents and Settings\AWong\My Documents\_to_be_move_3\Attachment A - Final - Aviation Market Stimulus

More information

What help can you expect from us in the event of a long delay, a cancelled flight or an overbooked flight?

What help can you expect from us in the event of a long delay, a cancelled flight or an overbooked flight? What help can you expect from us in the event of a long delay, a cancelled flight or an overbooked flight? This information is formulated according to Regulation EC 261/2004 of the European Parliament

More information

AIRPLANE UTILIZATION AND TURN-TIME MODELS PROVIDE USEFUL INFORMATION FOR SCHEDULE, FLEET, AND OPER ATIONS PLANNING.

AIRPLANE UTILIZATION AND TURN-TIME MODELS PROVIDE USEFUL INFORMATION FOR SCHEDULE, FLEET, AND OPER ATIONS PLANNING. AIRPLANE UTILIZATION AND TURN-TIME MODELS PROVIDE USEFUL INFORMATION FOR SCHEDULE, FLEET, AND OPER ATIONS PLANNING. Economic Impact of Airplane Turn-Times By Mansoor Mirza Regional Director, Economic and

More information

Bjørn Kjos (CEO) Oslo, 27. April 2006 Norwegian Air Shuttle ASA

Bjørn Kjos (CEO) Oslo, 27. April 2006 Norwegian Air Shuttle ASA Norwegian (NAS) Q1 2006 Bjørn Kjos (CEO) Oslo, 27. April 2006 Norwegian Air Shuttle ASA Strong revenue growth in Q1 539 MNOK in revenue in Q1 2006 Revenue growth of 69 % since Q1 2005 Revenue MNOK 600

More information

From Directorate General of Civil Aviation REGULATION ON THE RIGHTS OF PASSENGERS TRAVELING BY AIR (SHY-PASSENGER) SECTION ONE

From Directorate General of Civil Aviation REGULATION ON THE RIGHTS OF PASSENGERS TRAVELING BY AIR (SHY-PASSENGER) SECTION ONE Purpose From Directorate General of Civil Aviation REGULATION ON THE RIGHTS OF PASSENGERS TRAVELING BY AIR (SHY-PASSENGER) SECTION ONE Purpose, Scope, Basis, Definitions and Abbreviations ARTICLE 1 (1)

More information

FEES AND CHARGES. For the use of Heliports and Airports in Greenland. G. Season Cards and Flights Using Closed Landing Grounds

FEES AND CHARGES. For the use of Heliports and Airports in Greenland. G. Season Cards and Flights Using Closed Landing Grounds FEES AND CHARGES For the use of Heliports and Airports in Greenland TABLE OF CONTENTS A. General Provisions B. Take-Off Fee C. Passenger fee D. Reductions and Exemptions E. Parking Fee F. Opening Fee G.

More information

1. Merchandising company VS Service company V.S Manufacturing company

1. Merchandising company VS Service company V.S Manufacturing company Chapter 6 Mechandising Activities 1. Merchandising company VS Service company V.S Manufacturing company Manufacturing companies use raw materials to make the inventory they sell. Their operating cycles

More information

Incentive Schemes to air transport currently in force in Cyprus

Incentive Schemes to air transport currently in force in Cyprus Incentive Schemes to air transport currently in force in Cyprus 1. Objectives of Incentive Schemes Air transport in Cyprus is facilitated by the Larnaca and Paphos International Airports. On May 2006 an

More information

Jazz Air Income Fund presented by Allan Rowe Senior Vice President and Chief Financial Officer

Jazz Air Income Fund presented by Allan Rowe Senior Vice President and Chief Financial Officer Jazz Air Income Fund presented by Allan Rowe Senior Vice President and Chief Financial Officer Scotia Capital Transportation & Aerospace Conference May 16, 2006 Le Royal Meridien King Edward Hotel, Toronto

More information

Demand Forecasting in a Railway Revenue Management System

Demand Forecasting in a Railway Revenue Management System Powered by TCPDF (www.tcpdf.org) Demand Forecasting in a Railway Revenue Management System Economics Master's thesis Valtteri Helve 2015 Department of Economics Aalto University School of Business Aalto

More information