The Global Airline Industry

Editors: Belobaba, Peter, Omani, Amedeo and Barnhart, Cynthia
Publication Year: 2015
Publisher: Wiley

ISBN: 978-1-11-888117-0
Category: Business, Finance & Economics - Business
Image Count: 171
Book Status: Pending
Predicted Release Month: June 2017
Table of Contents

The Global Airline Industry, Second Edition provides a comprehensive introduction to the global airline industry. The perspective is international, drawing on the authors extensive experience with airline and air transport issues around the world. It features detailed coverage of airline economics, competition, pricing, planning, scheduling, operations, and ticket distribution, as well as survey chapters on airline labor relations, aviation safety and security, airports, air traffic control, environmental impacts, and the international regulatory environment in which the industry operates.

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Table of Contents

  • Notes on Contributors
  • Series Preface
  • Acknowledgments
  • 1 Introduction and Overview - Peter P. Belobaba
  • 1.1 Introduction: The Global Airline Industry
  • 1.1.1 Deregulation and Liberalization Worldwide
  • 1.1.2 Industry Evolution Since 2000
  • 1.2 Overview of Chapters
  • References
  • 2 The International Institutional and Regulatory Environment - Amedeo R. Odoni
  • 2.1 Introduction
  • 2.2 Background on the International Regulatory Environment
  • 2.2.1 The Chicago Convention
  • 2.2.2 Freedoms of the Air
  • 2.3 Airline Privatization and International Economic Regulation
  • 2.3.1 Airline Privatization
  • 2.3.2 Types and Critical Aspects of Air Service Agreements
  • 2.3.3 Typical Content of Bilateral and Multilateral ASAs
  • 2.3.4 The Unified EU Market and Other Major Developments
  • 2.3.5 The Role of Airline Alliances
  • 2.4 Airports
  • 2.4.1 Restrictions on Airport Access
  • 2.4.2 Airport Ownership and Management
  • 2.5 Air Traffic Management
  • 2.6 Key Organizations and Their Roles
  • 2.6.1 International Organizations
  • 2.6.2 Organizations in the United States
  • 2.7 Summary and Conclusions
  • References
  • 3 Overview of Airline Economics, Markets and Demand - Peter P. Belobaba
  • 3.1 Airline Terminology and Definitions
  • 3.1.1 Basic Airline Profit Equation
  • 3.2 Air Transportation Markets
  • 3.2.1 Typical Air Passenger Trip
  • 3.2.2 Spatial Definitions of Airline Markets
  • 3.3 Origin–Destination Market Demand
  • 3.3.1 Dichotomy of Airline Demand and Supply
  • 3.3.2 Factors Affecting Volume of O–D Demand
  • 3.3.3 Quality of Service Factors
  • 3.3.4 Total Trip Time and Frequency
  • 3.4 Air Travel Demand Models
  • 3.4.1 Elasticity of Air Travel Demand
  • 3.4.2 Air Travel Demand Segments
  • 3.4.3 O–D Market Demand Functions
  • 3.5 Airline Competition and Market Share
  • 3.5.1 Market Share/Frequency Share Model
  • 3.5.2 “S-Curve” Model Formulation
  • 3.5.3 Quality of Service Index (QSI) Models
  • 3.6 Summary
  • References
  • 4 Airline Pricing Theory and Practice - Peter P. Belobaba
  • 4.1 Airline Prices and O-D Markets
  • 4.1.1 Regulated versus Liberalized Pricing
  • 4.1.2 Theoretical Pricing Strategies
  • 4.1.3 Price Discrimination versus Product Differentiation
  • 4.2 Differential Pricing
  • 4.2.1 Market Segmentation
  • 4.2.2 Fare Product Restrictions
  • 4.2.3 Airline Fare Structures
  • 4.3 Recent Trends in Airline Pricing
  • 4.3.1 Branded Fare Families
  • 4.3.2 Unbundling and Ancillary Revenues
  • 4.4 Airline Pricing Strategies
  • 4.4.1 Factors Affecting Fare Structure in an O-D Market
  • 4.4.2 Competitive Fare Matching
  • References
  • 5 Airline Revenue Management - Peter P. Belobaba
  • 5.1 Computerized Revenue Management Systems
  • 5.2 Flight Overbooking
  • 5.3 EMSR Model for Flight Leg Revenue Optimization
  • 5.4 Network Revenue Management
  • 5.4.1 O-D Control Mechanisms
  • 5.4.2 Network RM Optimization Models
  • 5.4.3 Revenue Benefits of O-D Control
  • 5.5 Revenue Management for Less Restricted Fare Structures
  • 5.5.1 Demand Forecasting by Willingness to Pay
  • 5.5.2 Marginal Revenue Optimization: Fare Adjustment Theory
  • References
  • 6 Airline Operating Costs and Measures of Productivity - Peter P. Belobaba
  • 6.1 Airline Cost Categorization
  • 6.1.1 Administrative versus Functional Cost Categories
  • 6.1.2 Cost Drivers by Functional Category
  • 6.2 Operating Expense Comparisons
  • 6.2.1 Percentage Breakdown of Operating Expenses
  • 6.2.2 Aircraft Operating Cost Comparisons
  • 6.2.3 Low-Cost Carriers
  • 6.3 Comparisons of Airline Unit Costs
  • 6.3.1 Total Operating Costs versus Unit Costs
  • 6.3.2 Legacy versus Low-Cost Carrier Unit Costs
  • 6.4 Measures of Airline Productivity
  • 6.4.1 Aircraft Productivity
  • 6.4.2 Labor Productivity
  • References
  • 7 The Airline Planning Process - Peter P. Belobaba
  • 7.1 Fleet Planning
  • 7.1.1 Airline Fleet Decisions
  • 7.1.2 Fleet Planning Methods
  • 7.2 Route Planning
  • 7.2.1 Hub Economics and Network Structure
  • 7.2.2 Route Planning and Evaluation
  • 7.3 Airline Schedule Development
  • 7.3.1 Frequency Planning
  • 7.3.2 Timetable Development
  • 7.3.3 Fleet Assignment and Aircraft Rotations
  • 7.4 The Future: Integrated Airline Planning
  • References
  • 8 Airline Schedule Optimization - Cynthia Barnhart and Vikrant Vaze
  • 8.1 Schedule Optimization Problems
  • 8.2 Fleet Assignment
  • 8.2.1 The Fleet Assignment Model
  • 8.2.2 Fleet Assignment Solutions/Impacts
  • 8.2.3 Extending Basic Fleet Assignment Models
  • 8.3 Schedule Design Optimization
  • 8.3.1 Modeling the Optimization of Flight Retiming and Fleet Assignment Problems
  • 8.3.2 Importance of Modeling Competition in Schedule Design
  • 8.4 Crew Scheduling
  • 8.4.1 The Crew Pairing Problem
  • 8.4.2 Crew Scheduling Problem Solutions and Impacts
  • 8.5 Aircraft Maintenance Routing and Crew Pairing Optimization
  • 8.5.1 Modeling and Solving the Extended Crew Pairing Problem
  • 8.2 Fleet Assignment
  • 8.5.2 Modeling and Solving the Restricted Aircraft Maintenance Routing Problem Based on the Solution to the Extended Crew Pairing Problem
  • 8.6 Future Directions for Schedule Optimization
  • References
  • 9 Airline Flight Operations - Alan H. Midkiff, R. John Hansman, Jr., and Tom G. Reynolds
  • 9.1 Introduction
  • 9.2 Regulation and Scheduling
  • 9.2.1 General Regulatory Requirements
  • 9.2.2 Flight Crew Regulation and Training
  • 9.2.3 Flight Crew Scheduling
  • 9.3 Flight Crew Activities during a Typical Flight
  • 9.3.1 Flight Crew Sign-In
  • 9.3.2 Operations/Planning
  • 9.3.3 Preflight
  • 9.3.4 Predeparture
  • 9.3.5 Gate Departure
  • 9.3.6 Taxi-Out
  • 9.3.7 Takeoff
  • 9.3.8 Terminal Area Departure
  • 9.3.9 Climb
  • 9.3.10 Cruise
  • 9.3.11 Descent
  • 9.3.12 Terminal Area Arrival
  • 9.3.13 Final Approach
  • 9.3.14 Landing and Rollout
  • 9.3.15 Taxi-In
  • 9.3.16 Parking
  • 9.3.17 Postflight
  • 9.4 Summary
  • List of Abbreviations
  • References
  • 10 Irregular Operations: Schedule Recovery and Robustness - Cynthia Barnhart and Vikrant Vaze
  • 10.1 Introduction
  • 10.2 Irregular Operations
  • 10.2.1 Managing Irregular Operations: Airline Operations Control Centers
  • 10.2.2 Options for Schedule Recovery from Irregular Operations
  • 10.2.3 Schedule Recovery from Irregular Operations: Objectives and Process
  • 10.2.4 Evaluating the Costs of Recovery Options: The Challenges Imparted by Uncertainty and Downstream Effects
  • 10.3 Robust Airline Scheduling
  • 10.3.1 Robust Schedule Design
  • 10.3.2 Robust Fleet Assignment
  • 10.3.3 Robust Aircraft Routing
  • 10.3.4 Robust Crew Scheduling
  • 10.4 Directions for Ongoing and Future Work on Schedule Recovery from Irregular Operations
  • References
  • 11 Labor Relations and Human Resource Management in the Airline Industry - Jody Hoffer Gittell, Andrew von Nordenflycht, Thomas A. Kochan, Greg J. Bamber, and Robert B. McKersie
  • 11.1 Alternative Strategies for the Employment Relationship
  • 11.2 Labor Relations in the US Airline Industry
  • 11.2.1 Regulatory Framework for US Labor Relations
  • 11.2.2 US Airline Responses to Cost Pressures Postderegulation
  • 11.2.3 US Labor Relations Post-September 11, 2001
  • 11.3 Labor Relations in the Airline Industry in Other Countries
  • 11.3.1 The International Regulatory Framework for Labor Relations
  • 11.3.2 Summary of Airline Labor Relations Strategies: What Works?
  • 11.4 Human Resource Management at Airlines
  • 11.4.1 Hiring and Training for Relational Competence
  • 11.4.2 Flexible Boundaries between Jobs
  • 11.4.3 Supervisory Coaching and Feedback
  • 11.4.4 Performance Measurement at the Process Level
  • 11.4.5 Conflict Resolution
  • 11.4.6 Boundary Spanning Roles
  • 11.4.7 Partnering with Other Key Players
  • 11.4.8 Leadership
  • 11.5 Conclusions
  • References
  • 12 Aviation Safety and Security - Arnold I. Barnett
  • 12.1 Safety
  • 12.1.1 Safety Is No Accident
  • 12.1.2 Measuring Air Safety: Some Hazards
  • 12.1.3 The Q-Statistic
  • 12.1.4 Some Calculated Q-Values
  • 12.1.5 Other Approaches to Safety Measurement
  • 12.1.6 Are Some Airlines Safer Than Others?
  • 12.1.7 The Last Century
  • 12.1.8 A Collision Risk Assessment
  • 12.1.9 Midair Collision Risk
  • 12.2 Security
  • 12.2.1 September 11 in Context
  • 12.2.2 Some Costs of Aviation Security
  • 12.2.3 Some Security Procedures
  • 12.2.4 Is It Worth It?
  • 12.2.5 Two Economic Paradigms
  • 12.2.6 A European Dilemma
  • 12.2.7 More Security Dilemmas
  • 12.2.8 Final Remarks
  • References
  • 13 Airports - Amedeo R. Odoni
  • 13.1 Introduction
  • 13.2 General Background
  • 13.3 Physical Characteristics
  • 13.3.1 Airside Design Standards
  • 13.3.2 Geometric Configuration on Airside
  • 13.3.3 Typology of Passenger Buildings
  • 13.3.4 Assessing Passenger Building Concepts
  • 13.3.5 Ground Access
  • 13.4 Capacity, Delays, and Demand Management
  • 13.4.1 Airside Capacity
  • 13.4.2 Airside Delays and Their Mitigation
  • 13.4.3 Landside Capacity and Level of Service
  • 13.5 Institutional, Organizational, and Economic Characteristics
  • 13.5.1 Airport Ownership and Management
  • 13.5.2 Airport User Charges
  • 13.5.3 Economic Regulation
  • 13.5.4 Financing Capital Projects
  • References
  • 14 Air Traffic Control - R. John Hansman, Jr. and Amedeo Odoni
  • 14.1 Introduction
  • 14.2 The Generic Elements of an ATC System
  • 14.2.1 Communications Systems
  • 14.2.2 Navigation Systems
  • 14.2.3 Surveillance Systems
  • 14.2.4 Flight and Weather Information Systems
  • 14.3 Airspace and ATC Structure
  • 14.4 ATC Operations
  • 14.5 Standard Operating Procedures
  • 14.6 Capacity Constraints
  • 14.7 Congestion and Air Traffic Flow Management
  • 14.8 Future ATC Systems
  • References
  • 15 Air Transport and the Environment - Karen Marais, Philip J. Wolfe, and Ian A. Waitz
  • 15.1 Introduction
  • 15.2 Limiting Aviation's Environmental Impact: The Role of Regulatory Bodies
  • 15.3 Airport Water Quality Control
  • 15.3.1 Effects of Deicing Fluids
  • 15.3.2 Managing Airport Water Quality
  • 15.4 Noise
  • 15.4.1 Effects
  • 15.4.2 Noise Measurement
  • 15.4.3 Noise Trends
  • 15.4.4 Noise Controls
  • 15.4.5 Emerging Issues
  • 15.5 Air Quality
  • 15.5.1 Effects
  • 15.5.2 Emissions Measurement
  • 15.5.3 Emissions Trends
  • 15.5.4 Emissions Control
  • 15.5.5 Emerging Issues
  • 15.6 Impact of Aviation on Climate
  • 15.6.1 Effects
  • 15.6.2 Measurement
  • 15.6.3 Greenhouse Emissions Control
  • 15.7 Alternative Fuels
  • 15.8 Summary and Looking Forward
  • References
  • 16 Information Technology in Airline Operations, Distribution and Passenger Processing - Peter P. Belobaba, Cynthia Barnhart, and William S. Swelbar
  • 16.1 Information Technology in Airline Planning and Operations
  • 16.2 Airline Distribution Systems
  • 16.2.1 Evolution of Computer Reservations Systems
  • 16.2.2 Alternative Airline Distribution Channels
  • 16.3 Distribution Costs and e-Commerce Developments
  • 16.3.1 Internet Distribution Channels
  • 16.3.2 Electronic Ticketing
  • 16.3.3 Implications for Airlines and Consumers
  • 16.4 Innovations in Passenger Processing
  • References
  • 17 Critical Issues and Prospects for the Global Airline Industry - Peter P. Belobaba, William S. Swelbar, and Amedeo R. Odoni
  • 17.1 Evolution of US and Global Airline Markets
  • 17.1.1 Evolution of US Airline Markets
  • 17.1.2 Recent Developments in Global Airline Markets
  • 17.2 Looking Ahead: Critical Challenges for the Global Airline Industry
  • 17.2.1 Strategies for Sustained Profitability
  • 17.2.2 Infrastructure and the Environment
  • References