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Airline route network expansion: Modelling the benefits of slot purchases

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  • Babic, Danica
  • Kalic, Milica

Abstract

This paper describes a decision-making model for estimating the value of airport slots for airlines. Assuming that an airline wants to improve its flight schedule by adding new slots to its portfolio the model would enable it to investigate if such a purchase of slots in the secondary market would be profitable. The model outputs are the new flight schedule, the years necessary to recoup the initial outlay in buying the new slots, and the number of potential connections that the airline could realize if the new slots are introduced. The solutions are feasible from the aspect of aircraft availability for new flights, the realized profit for an airline, and finally, an acceptable pay-off period for the purchased slots. The model is tested on real data from a mid-sized European airline.

Suggested Citation

  • Babic, Danica & Kalic, Milica, 2012. "Airline route network expansion: Modelling the benefits of slot purchases," Journal of Air Transport Management, Elsevier, vol. 23(C), pages 25-30.
    • Handle: RePEc:eee:jaitra:v:23:y:2012:i:c:p:25-30
    DOI: 10.1016/j.jairtraman.2012.03.002
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    References listed on IDEAS

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    1. Burghouwt, Guillaume & de Wit, Jaap, 2005. "Temporal configurations of European airline networks," Journal of Air Transport Management, Elsevier, vol. 11(3), pages 185-198.
    2. Button, Kenneth, 2002. "Debunking some common myths about airport hubs," Journal of Air Transport Management, Elsevier, vol. 8(3), pages 177-188.
    3. J.S. Mashford & B.S. Marksjö, 2001. "Airline Base Schedule Optimisation by Flight Network Annealing," Annals of Operations Research, Springer, vol. 108(1), pages 293-313, November.
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    Cited by:

    1. Lay Eng Teoh & Hooi Ling Khoo, 2016. "Fleet Planning Decision-Making: Two-Stage Optimization with Slot Purchase," Journal of Optimization, Hindawi, vol. 2016, pages 1-12, June.
    2. Pellegrini, Paola & Rodriguez, Joaquin, 2013. "Single European Sky and Single European Railway Area: A system level analysis of air and rail transportation," Transportation Research Part A: Policy and Practice, Elsevier, vol. 57(C), pages 64-86.
    3. Lee, Heeyeon & Jung, Jihyeok & Lee, Deok-Joo, 2024. "An auction-based airport slot reallocation scheme considering the grandfather rights of airlines," Journal of Air Transport Management, Elsevier, vol. 118(C).
    4. Lohmann, Gui & Vianna, Camila, 2016. "Air route suspension: The role of stakeholder engagement and aviation and non-aviation factors," Journal of Air Transport Management, Elsevier, vol. 53(C), pages 199-210.

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