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Strategic planning in fractional aircraft ownership programs

Author

Listed:
  • Yao, Yufeng
  • Ergun, Özlem
  • Johnson, Ellis
  • Schultz, William
  • Singleton, J.M.

Abstract

In the fractional ownership model, the partial owner of an aircraft is entitled to certain flight hours per year, and the management company is responsible for all the operational considerations of the aircraft and for making an aircraft available to the owner at the requested time and place. In the recent years although the industry as a whole has experienced significant growth, most of the major fractional jet management companies have been unprofitable. To increase profitability a management company must minimize its operating costs and increase its crew and aircraft utilization. In this paper, we present a methodology for efficiently scheduling the available resources of a fractional jet management company that takes into consideration the details in real world situations. We then discuss several strategic planning issues, including aircraft maintenance, crew swapping, demand increase and differentiation, and analyze their effects on the resource utilization and profitability.

Suggested Citation

  • Yao, Yufeng & Ergun, Özlem & Johnson, Ellis & Schultz, William & Singleton, J.M., 2008. "Strategic planning in fractional aircraft ownership programs," European Journal of Operational Research, Elsevier, vol. 189(2), pages 526-539, September.
    • Handle: RePEc:eee:ejores:v:189:y:2008:i:2:p:526-539
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    References listed on IDEAS

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    Cited by:

    1. Yiting Xing & Ling Li & Zhuming Bi & Marzena Wilamowska‐Korsak & Li Zhang, 2013. "Operations Research (OR) in Service Industries: A Comprehensive Review," Systems Research and Behavioral Science, Wiley Blackwell, vol. 30(3), pages 300-353, May.
    2. K Fagerholt & B A Foss & O J Horgen, 2009. "A decision support model for establishing an air taxi service: a case study," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 60(9), pages 1173-1182, September.
    3. Munari, Pedro & Alvarez, Aldair, 2019. "Aircraft routing for on-demand air transportation with service upgrade and maintenance events: Compact model and case study," Journal of Air Transport Management, Elsevier, vol. 75(C), pages 75-84.

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