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Aircraft replacement strategy: Model and analysis

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  • Bazargan, Massoud
  • Hartman, Joseph

Abstract

This study presents a model to help airlines plan their strategic fleet acquisitions and disposals. It minimizes the discounted costs of owning or leasing and operating a fleet by identifying which aircraft to buy, sell and lease over the planning horizon. The paper explains how the related cost data were compiled and analyzed. The model is applied to two US airlines with different business models and shows that aircraft leasing is generally the preferred alternative with benefits from having newer aircraft and less fleet diversity.

Suggested Citation

  • Bazargan, Massoud & Hartman, Joseph, 2012. "Aircraft replacement strategy: Model and analysis," Journal of Air Transport Management, Elsevier, vol. 25(C), pages 26-29.
    • Handle: RePEc:eee:jaitra:v:25:y:2012:i:c:p:26-29
    DOI: 10.1016/j.jairtraman.2012.05.001
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    References listed on IDEAS

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    1. Chunhua Gao & Ellis Johnson & Barry Smith, 2009. "Integrated Airline Fleet and Crew Robust Planning," Transportation Science, INFORMS, vol. 43(1), pages 2-16, February.
    2. Hsu, Chaug-Ing & Li, Hui-Chieh & Liu, Su-Miao & Chao, Ching-Cheng, 2011. "Aircraft replacement scheduling: A dynamic programming approach," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 47(1), pages 41-60, January.
    3. Oum, Tae Hoon & Zhang, Anming & Zhang, Yimin, 2000. "Optimal demand for operating lease of aircraft," Transportation Research Part B: Methodological, Elsevier, vol. 34(1), pages 17-29, January.
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    Cited by:

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    3. Geursen, Izaak L. & Santos, Bruno F. & Yorke-Smith, Neil, 2023. "Fleet planning under demand and fuel price uncertainty using actor–critic reinforcement learning," Journal of Air Transport Management, Elsevier, vol. 109(C).
    4. Rosskopf, Michael & Lehner, Stephan & Gollnick, Volker, 2014. "Economic–environmental trade-offs in long-term airline fleet planning," Journal of Air Transport Management, Elsevier, vol. 34(C), pages 109-115.
    5. Weiwei Lin & Jing Lu & Jinfu Zhu & Li Xu, 2022. "Research on the Sustainable Development and Dynamic Capabilities of China’s Aircraft Leasing Industry Based on System Dynamics Theory," Sustainability, MDPI, vol. 14(3), pages 1-19, February.
    6. Jing Zhou, 2023. "Airline capacity distribution under financial budget and resource consideration," Journal of Combinatorial Optimization, Springer, vol. 45(5), pages 1-29, July.
    7. Chen, Wei-Ting & Huang, Kuancheng & Ardiansyah, Muhammad Nashir, 2018. "A mathematical programming model for aircraft leasing decisions," Journal of Air Transport Management, Elsevier, vol. 69(C), pages 15-25.
    8. Carreira, Joana S. & Lulli, Guglielmo & Antunes, António P., 2017. "The airline long-haul fleet planning problem: The case of TAP service to/from Brazil," European Journal of Operational Research, Elsevier, vol. 263(2), pages 639-651.

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