An Economic Analysis of the Hub-and-spoke Routing Strategy in the Airline Industry PDF Download

Author: William Scott McShan
Publisher:
ISBN:
Category : Airlines
Languages : en
Pages : 172

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Author: William Scott McShan
Publisher:
ISBN:
Category : Airlines
Languages : en
Pages : 344

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Author: Ross M. Starr
Publisher:
ISBN:
Category :
Languages : en
Pages :

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Author: Alessandro Cento
Publisher: Springer Science & Business Media
ISBN: 3790820881
Category : Business & Economics
Languages : en
Pages : 189

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The debate on the future of the aviation sector and the viability of its traditional business practices is the core of this book. The liberalization of the EU market in the 1990s has radically modi?ed the competitive environment and the nature of airline competition. Furthermore, the new millennium began with terrorist attacks, epidemics, trade globalization, and the rise of oil prices, all of which combined to push the industry into a “perfect storm”. Airline industry pro?tability has been an elusive goal for several decades and the recent events has only accentuated existing weaknesses. The main concern of ind- try observers is whether the airline business model, successful during the 1980s and 1990s, is now sustainable in a market crowded by low-cost carriers. The airlines that will respond rapidly and determinedly to increase pressure to restructure, conso- date and segment the industry will achieve competitive advantages. In this context, the present study aims to model the new conduct of the ‘legacy’ carriers in a new liberalized European market in terms of network and pricing competition with l- cost carriers and competitive reaction to the global economic crises.

Author: Peter H.M. Vervest
Publisher: Springer Science & Business Media
ISBN: 3540855823
Category : Business & Economics
Languages : en
Pages : 367

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Digital networking technologies are empowering organizations to form dynamic networks, generating exceptional or ‘smart’ results. These Smart Business Networks (SBNs) enable individual organizations to compete more effectively and to respond better to a changing world. This idea attracted a diverse group of academic scholars and business professionals to Beijing from May 19-23, 2008, hosted by Tsinghua University. They discovered new ways to manage network resources, operate business processes across a network, create a business operations platform, understand the importance of network position and the smart mastering of technology. Effective managers, they concluded, must have a firm understanding of these fundamental network concepts in order to orchestrate the networks of the future. This book presents the results of an intense and energizing event which resulted in new theoretical foundations and practical insights.

Author:
Publisher:
ISBN:
Category : Ohio
Languages : en
Pages : 376

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Author: Ahmad K. Naimzada
Publisher: Springer Science & Business Media
ISBN: 3540684093
Category : Business & Economics
Languages : en
Pages : 292

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There is convergent consensus among scientists that many social, economic and ?nancial phenomena can be described by a network of agents and their inter- tions. Surprisingly, even though the application ?elds are quite different, those n- works often show a common behaviour. Thus, their topological properties can give useful insights on how the network is structured, which are the most “important” nodes/agents, how the network reacts to new arrivals. Moreover the network, once included into a dynamic context, helps to model many phenomena. Among the t- ics in which topology and dynamics are the essential tools, we will focus on the diffusion of technologies and fads, the rise of industrial districts, the evolution of ?nancial markets, cooperation and competition, information ?ows, centrality and prestige. The volume, including recent contributions to the ?eld of network modelling, is based on the communications presented at NET 2006 (Verbania, Italy) and NET 2007 (Urbino, Italy); offers a wide range of recent advances, both theoretical and methodological, that will interest academics as well as practitioners. Theory and applications are nicely integrated: theoretical papers deal with graph theory, game theory, coalitions, dynamics, consumer behavior, segregation models and new contributions to the above mentioned area. The applications cover a wide range: airline transportation, ?nancial markets, work team organization, labour and credit market.

Author: Bridget Ssamula
Publisher:
ISBN:
Category :
Languages : en
Pages :

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The aviation industry worldwide is changing dynamically in reaction to trends such as globalisation and with the need to increase market share to remain competitive. The African aviation industry still faces many problems in the institutional, technical and operational areas. Despite its potential for enhancing economic development, air travel to and from Africa remains a small percentage of world air travel. The African air route network is characterised by sparse demand, with long sector distances, low frequencies and high fares. This study investigates cost-effective hub-and-spoke (H&S) network design strategies for the African route network. An H&S network would minimise the cost of air transport and improve accessibility and connectivity. The study challenges the typical characteristics of H&S networks which are usually found in denser route networks. The design methodology used was the one most appropriate for the African region, using the datasets and tools available. As a first-cut analysis for Africa, the results of the research contribute to understanding the effectiveness of H&S networks in markets with sparse demand. A cost model previously developed by the author to calculate operating costs on a route was used. It eliminated the need to assume discount coefficients on links, as passenger demand increases, in a field with limited data. The cost indicators derived from the model were used as criteria for choosing the most efficient hubs within a cluster. These were compared with the hub location criteria in the literature which use distances and passengers. It was found that using the cost indicators gives a reasonably consistent method that lowers passenger travel time. The optimum number of clusters and hubs was found to be four. The geo-political network design method yielded the lowest network costs. The hubs are centrally located within the clusters: Morocco in the north, South Africa in the south, Kenya in the east and Nigeria in the west. They are characterised by high passenger demand and short node-hub sectors. There are significant benefits to be gained from using this hub network design, resulting from the economies of scale with higher passenger densities on routes. Furthermore, the benefits of higher service frequencies and better connectivity outweigh the extra travel time when routing through hubs. The study found that for sparse networks, the cheapest hub-location options have high passenger demand. The sector distance is crucial in lowering operating costs as smaller, more efficient short range aircraft can be operated. It is therefore more efficient to assign nodes to the closest hub to lower node-hub costs. The optimum number of hubs/clusters is thus determined by the distance threshold for the efficient aircraft. The effect of changing the cluster boundaries on network costs also depends on the change in node-hub distances between the clusters. As sparsity reduces, the economies-of-scale benefits outweigh the increasing operating costs of longer distances, allowing efficient operation of larger-capacity aircraft. This means that the location of the hubs and the number of clusters becomes more flexible, implying that node-hub links can become longer, reducing both the clusters and the number of hubs.

Author: Herbert Baum
Publisher: Taylor & Francis
ISBN: 1351897683
Category : Transportation
Languages : en
Pages : 689

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This book provides a comprehensive overview of current strategic challenges and measures required to meet those challenges in a dynamic industry. Experts from aviation practice and management, in addition to acknowledged scholars, contribute to this volume and combine academic expertise with economic and business perspectives in an unprecedented way for the aviation field. The focus is not restricted to passenger airlines. The five parts of the book additionally include chapters on alliance management and formation, strategic issues for air freight carriers and airport companies, as well as impacts the airline industry exerts on its environment. The book combines both concepts and results from recent academic research with applications and case studies from major industry players. Readership includes academics, students on advanced aviation courses, senior aviation professionals in airline, airport and supplier companies, international organizations and governmental agencies.

Author: Aisling J. Reynolds-Feighan
Publisher: Springer Science & Business Media
ISBN: 3642770614
Category : Science
Languages : en
Pages : 143

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1. 1 A Brief History of U. S. Commercial Aviation Regulation and Deregulation The U. S. commercial aviation industry was regulated by the government for a period of 40 years, beginning in 1938 with. the passing of the Federal Aviation Act, and ending in October 1978 when President Carter signed into law the Airline Deregulation Act (ADA). There were 16 airlines in existence when the Federal Aviation Act was passed in 1938 (the so-called 'trunk lines'). The Act established the Civil Aeronautics Authority (CAA) as the industry's regulatory body. The Act was passed principally because it was felt that the free market, if allowed to continue unregulated for much longer, would put many of these firms into bankruptcy. It is possible therefore to view the CAA of 1938 (re-organized into the Civil Aeronautics Board (CAB) in 1940) as a response to a potential market failure at the time. In the 1930s, few air traffic markets could have efficiently"supported more than one airline operating in the market [Panzar (1980)]. Competition among the carriers was cut-throat, and it was felt that the near bankruptcy of the airlines in the period was caused principally by the competitive bidding system used by the Post Office in allotting airmail subsidies [Keeler (1972), Caves (1962)].