Track: Operations Research

Abstract

Air transportation facilitates integration of the global economy and plays a vital role in both local and global economic development through the increasing passengers and freight traffic demands.  Thus, this paper aims to minimize the operational cost of a budget airline’s fleet operation by selecting the most suitable aircraft type among the company’s existing fleet using the analytic hierarchy process (AHP). Then, the linear programming method was used to optimize the allocation of fleet to its operations that will minimize the daily operational expenses in nineteen (19) proposed domestic destinations from Manila. The linear programming model considered the following constraints: (1) Supply of Available Seat must meet Passenger Traffic Demand (2) Minimum Flight Frequency Requirement (3) Assignment of Aircraft Type to Destination’s Airport and (4) Available Fleet Operating Hours per Aircraft Type per Day.  The results obtained the frequency of flights per aircraft type per route to nineteen (19) domestic destinations that meets the passenger demand at minimum cost to the airline company. In addition, it was also realized that the fleet size could be reduced based on the remaining available hours of operation. The optimal solution maximized the available operating hours of the A330-200 and A321-200 CEO aircraft type. The A330-200’s high seat capacity catered to the high demand of the destination. Despite the highest operational cost among other aircraft types, it was able to transport more passengers in one flight. While only 21% of the A321 NEO’s operating capacity was utilized. Therefore, the A321 NEO’s fleet size could be reduced to only 1 aircraft. Both the analytic hierarchy process (AHP) and linear programming (LP) were an effective tool in supporting the decision-making process of airline domestic operations. The AHP was able to determine the most suitable aircraft. And the LP optimized the fleet operations at minimum cost.  Both methods could also be further improved by considering additional factors such as aircraft operational compatibility for AHP and other factors affecting flight operations for the LP model.