A Dynamic Programming Model to Optimize the Capacity Control with the Priority of Air Cargo

This paper concentrates on the problem of the air cargo space management strategy with a comprehensive, abstract and simplified way, on the basis of the actual characteristics of transport demand in China's air cargo market. We focus on the urgent transportation of goods and general cargo transport whose time requirements are different. The paper first proposes a single-leg cargo space management dynamic programming model according to the different time limit of different kinds of goods, and then the two dimensional single-leg air cargo problem is transformed into one dimensional two-leg airline network problem. After that, we use the expanded method of dynamic programming decomposition to solve the model. A numerical example is solved and simulated to verify the effectiveness of the program

Modeling and optimization of single-leg multi-fare class overbooking problem: the case of Ethiopian Airlines

Revenue Management, also known as yield management, is a technique used by airline industries to maximize revenue by allocating the available seats to the right customers at the right price. Overbooking is an airline revenue management technique that enables airlines to sell more seats than available in order to account for the fact that some of the passengers may not show-up or cancel their flights on the departure day. The objective of this thesis is to develop an overbooking model for a single-leg multi-fare class flight considering a realistic distribution of no-show data collected from the Ethiopian airlines. The overbooking model developed considers the interaction (i.e. the transfer of an extra passenger in a lower fare classes to higher fare class empty seat) between classes that may exist during boarding time. Moreover, this work investigates the economic rationale behind the no overbooking policy used by Ethiopian airlines for some of its flights. The overbooking model developed was solved using both a closed form approach using derivatives and Monte Carlo simulation with a derivative free optimization algorithm. A comparison of the revenue generated from no-overbooking policy, the closed form solution, and the Monte Carlo simulation solution approach shows that the Monte Carlo simulation solution approach performs well. Generally, the numerical results show that the overbooking model is effective in determining the optimal number of overbooking for a number of classes and a variety of compensation cost plans

集装箱班轮二维收益管理在线动态定价策略

为了在现实约束条件下最大化班轮公司收益,研究了集装箱海运二维收益管理多航段多箱型在线动态定价模型,提出了其最优在线动态定价策略,并且证明了模型价值函数的单调性及其上界.基于降维的思想提出了更为实际的启发式算法.在算例中分析了单航段单箱型、单航段多箱型和多航段多箱型3种情况下的最优动态定价策略,分析结果表明:在单航段单箱型的情况下,最优价格具有单调性;在单航段多箱型和多航段多箱型的情况下,最优价格不一定具有单调性

Diseño de un modelo de selección de estrategia de sobre reserva en el sector de transporte aéreo de pasajeros aplicando un método multicriterio

La selección de la estrategia de sobreventa de transporte aéreo hace parte de la definición estratégica de la compañía porque afecta tanto los ingresos como la calidad del servicio. En Colombia, se reporta (Aerocivil, 2017) que el 18% del pago de las compensaciones a los pasajeros que se les deniega el abordaje se explica por las estrategias de sobre reserva definidas para mitigar el impacto de la tasa de presentación de los pasajeros, que en algunos casos se ve subestimada generando esta afectación. Con el fin de disminuir sanciones económicas y legales para las compañías aéreas, las afectaciones a los pasajeros, aumentar la preferencia de un vuelo por la calidad en el servicio e incrementar los ingresos netos de las empresas, éste trabajo desarrolla un modelo de decisión multicriterio de análisis jerárquico, para determinar la estrategia de sobre reserva adecuada, contemplando los criterios y variables relevantes sobre la decisión.Abstract: The overbooking strategy decision in the air transportation belongs to the strategic definition of the company because it affects both revenue and quality of service. In Colombia, it is reported (Aerocivil, 2017) that 18% of the compensation payments to passengers who are denied boarding are explained by the overboking strategies, these are defined to mitigate the impact of the passenger’s show up rate, which in some cases is subestimated generating this affectation. In order to reduce economic and legal sanctions for airlines, affected passengers, and, increase the preference for quality service and the net revenues of companies, this work develops a multicriteria decision model of hierarchical analysis, to determine the appropiate overbooking strategy, taking into account the relevants criteria and variables to the decision.Maestrí

A study on air cargo revenue management

Ph.DDOCTOR OF PHILOSOPH

Dynamic Capacity Control in Air Cargo Revenue Management

This book studies air cargo capacity control problems. The focus is on analyzing decision models with intuitive optimal decisions as well as on developing efficient heuristics and bounds. Three different models are studied: First, a model for steering the availability of cargo space on single legs. Second, a model that simultaneously optimizes the availability of both seats and cargo capacity. Third, a decision model that controls the availability of cargo capacity on a network of flights

Open loop policies for single-leg air-cargo revenue management

Transporting cargo is a significant source of revenue in the airline industry. It is therefore of critical importance to develop booking policies that address the unique challenges presented by the cargo business: the capacity is multi-dimensional, generally measured in terms of volume and weight, and the exact capacity requirements of a shipment are usually not known with certainty at the time of making booking decisions. Operations research methods have proven highly useful in passenger revenue management to effectively allocate a limited capacity while considering the trade-off between the penalty costs for oversold capacity and the opportunity costs for having unused capacity at the departure time. In this thesis, we develop similar methods for the capacity control problem over a single-leg flight with multiple cargo types. We study open loop policies that accept or reject a booking request for a certain type of cargo shipment based on booking limits or bid-prices. In order to compute suitable booking limits and bid-prices, we develop optimization models that incorporate off-loading costs under uncertain volume and weight requirements. We conduct a comprehensive computational study to evaluate the effectiveness of our proposed models. Numerical results demonstrate that our policies perform well compared to benchmarks established by various methods in the literature

Dynamic Capacity Control in Air Cargo Revenue Management

This work studies air cargo capacity control problems. The focus is on analyzing decision models with intuitive optimal decisions as well as on developing efficient heuristics and bounds. Three different models are studied: First, a model for steering the availability of cargo space on single legs. Second, a model that simultaneously optimizes the availability of both seats and cargo capacity. Third, a decision model that controls the availability of cargo capacity on a network of flights

Intégration de la planification des opérations et de la gestion du revenu pour le transport ferroviaire de marchandises

Dans cette thèse, nous nous intéressons à l’analyse de l’intégration de processus décisionnels issus de la gestion des revenus aux politiques de gestion des opérations d’un transporteur ferroviaire de marchandises. Les entreprises de services de ce secteur sont tributaires de nombreuses op´erations logistiques complexes dont : – l’élaboration des politiques de blocage et de routage des wagons, – la planification du routage, de l’habillage et des horaires des trains, – la gestion des opérations des cours de triage, – l’affectation des locomotives, – le repositionnement des wagons vides, – la planification des horaires des équipages. Les études traitant de transport ferroviaire de marchandises, bien que nombreuses, ne considèrent typiquement qu’un sous-ensemble des activités mentionnées. En effet, la taille et la complexité des problèmes résultant de la combinaison des opérations identifiées représentent des obstacles au développement d’approches m´ethodologiques intégrées. De plus, peu de chercheurs se sont penchés sur la mise en place d’outils de gestion des revenus dans le secteur du transport de marchandises par rail et ce malgré l’impact majeur de ceux-ci en transport aérien notamment. Dans un premier temps, nous illustrons donc l’état de la recherche dans les deux sphères d’étude présentées afin d’établir de façon claire la problématique qui sera traitée. Pour ce faire, nous recensons les principales contributions scientifiques et nous introduisons les concepts qui seront fondamentaux au positionnement de cette thèse par rapport aux récentes publications proposées dans la littérature. Une fois l’axe de recherche identifié, nous présentons quelques formulations décrivant l’intégration proposée selon que le niveau de planification privilégié soit opérationnel ou tactique. ----------- ABSTRACT This thesis studies the integration of decision processes based on revenue management with operations planning policies of a rail freight carrier. Services companies in this field must face complex logistic operations such as : – block planning and car routing, – train routing, makeup and scheduling, – yard management, – locomotive assignment, – empty car repositioning, – crew scheduling. Even if freight rail transportation problems have been thoroughly analyzed in the past, they typically consider only a subset of the operations mentioned. The size and the complexity of combining the identified problems have prevented the development of integrated methodological approaches. Moreover, few researchers have tackled the challenge of proposing revenue management tools for freight rail applications despite their major impact in air transportation for instance. First of all, we describe the current state of research for the two fields presented in order to clearly establish the problem that will be addressed. We therefore review the main scientific contributions and introduce the fundamental concepts that will enable us to position ourselves in relation to recent publications. Once the research perspectives are identified, we present some formulations describing the proposed integration according to the chosen planning level, which could be either operational or tactical. These help to highlight the combined management decisions related to the development of the operating plan and those arising from tariff policies dictated by the company. Through bilevel programming we study user behavior in response to different pricing strategies while considering network capacity resulting from the operational policies of the carrier

Two-dimensional cargo overbooking models

This paper introduces two-dimensional (weight and volume) overbooking problems arising mainly in the cargo revenue management, and compares them with one-dimensional problems. It considers capacity spoilage and cargo offloading costs, and minimizes their sum. For one-dimensional problems, it shows that the optimal overbooking limit does not change with the magnitude of the booking requests. In two-dimensional problems, the overbooking limit is replaced by a curve. The curve, along with the volume and weight axes, encircles the acceptance region. The booking requests are accepted if they fall within this region. We present Curve (Cab) and Rectangle (Rab) models. The boundary of the acceptance region in the Cab (resp. Rab) model is a curve (resp. rectangle). The optimal curve for the Cab model is shown to be unique and continuous. Moreover, it can be obtained by solving a series of simple equations. Finding the optimal rectangle for the Rab model is more challenging, so we propose an approximate rectangle. The approximate rectangle is a limiting solution in the sense that it converges to the optimal rectangle as the booking requests increase. The approximate rectangle is numerically shown to yield costs that are very close to the optimal costs.Revenue management Cargo overbooking Capacity spoilage Cargo offloading