Optimal Airline Route Network Planning Model

Studies from Boeing, McKinsey and BCG 2020-2022 have identified three-fold challenges in airline in strategic network planning, which have not yet been addressed: (1) Challenge of reflecting dynamic and dual nature of passenger demand and market supply, (2) Challenge of factoring crew resource limitations and (3) Challenge of including or excluding destinations flexibly for strategic reasons.

To address this gap, we extend the state-of-the-art network planning research for route network optimisation, which is based on Non-linear Mixed Integer Programming. Among other extensions we introduce available crew hours, mandatory minimum and maximum frequencies for strategic reasons as new constraints and differentiate between direct and connecting passengers in the demand supply interactions.

We then apply our model on a group of four European full-service network airlines, to identify the most profitable route network, fleet and weekly frequencies. In comparison to the un-optimised reference network, our proposed model demonstrates an improvement in profitability in the range of 1-4%, for the scenarios conducted. Further analyses indicate that the proposed optimized network plan closely reflect real world behaviour, through metrics such as the network load factor, as evaluated by the industry experts.