Pre-study of traffic planning optimizer for potential implementation at TUIfly Nordic Per Enqvist, Senior Advisor Clement Berguerand, Supervisor at TUIfly Nordic Department of Mathematics Royal Institute of Technology December 2010 Copyright © 2010 Mercedes Inal and TUIfly Nordic All Rights Reserved ABSTRACT Pre-study of traffic planning optimizer for potential implementation at TUIfly Nordic Mercedes Inal Department of Mathematics Master of Science Optimization in the airline industry is hard to accomplish, there are many areas of equal importance all of which with important and often contradicting parameters to take into account in order to achieve a model that represents real world situations. This report gives a unique account of the planning process as it is observed for the duration of this project at TUIfly Nordic. It is far from a complete documentation of airline planning processed but it is an insight as to how one such process takes place. With focus on the scheduling process for air-traffic program it was found that a risk management analysis into the operating parameters of a schedule is necessary and that before researching the implementation of third-party software, an inventory of the software available at the time of writing is more beneficiary to the current work flow. Keywords: Airline optimization, air-traffic planning, TUIfly Nordic. ABSTRAKT Förstudie av ett optimerings program för flygtrafik planering och dess potentiella implementation hos TUIfly Nordic Mercedes Inal Department of Mathematics Master of Science Optimering i flygbranschen är svårt att åstadkomma, det finns många områden av lika stor bety- delse alla med viktiga och ofta motstridiga parametrar att ta hänsyn till för att uppnå en modell som representerar verkligheten. Denna rapport ger en unik bakgrund av flygtrafikplanerings processen som observerats för det här projektet på TUIfly Nordic. Det är långt ifrån en komplett dokumenta- tion av hur flygbolag utför sin flygtrafikplanering, men det är en insikt i hur en sådan process sker. Med fokus på schemaläggnings processen för flygtrafiken konstaterades det att en riskanalys av driftparametrar som påverkar ett flygtrafikschema är nödvändigt och att innan forsking läggs ner för investering av tredje partens programmvara är det rekommenderat att utföra en undersökning i tillgänglig programvara som kan underlätta det nuvarande arbetsflödet. Nyckelord: Airline optimization, air-traffic planning, TUIfly Nordic. ACKNOWLEDGMENTS I would like to acknowledge the people at TUIfly Nordic for their knowledge and insights that by far make up the body of this project it has been a great experience. Thank you to my supervisors for good advice and at times pushing the project forward once more, Clement Berguerand for reviewing this document and for ripping it to shreds as every good advisor should do to a thesis draft, Anne-Lie Bråholm and Marcus Karlsson the Planners. There are several more that have helped me along the way and I am grateful to have met all of you and appreciate all the help you have given me along the way. My most heartfelt thank you to my senior supervisor Lecturer and researcher at KTH Per Enqvist for his patience, countless amounts of advice in hard times and general therapy. Finally, I would like to offer condolences to a great teacher, Professor Ulf Jönsson, you will be missed. Contents Table of Contents v List of Figures vii List of Tables viii 1 Introduction 1 1.1 Structure....................................... 2 1.2 Literature ...................................... 2 1.3 Purposeandproblemdescription . ....... 3 1.3.1 Background.................................. 4 1.3.2 Limitationsanddemands. .. 5 1.4 TUIAGGroup .................................... 6 1.4.1 TUIflyNordic................................. 6 1.4.2 Touroperator................................. 7 1.5 CoststructureforTUIflyNordic . ...... 8 2 Planning process 10 2.1 Timeframeandinvolvedparties. ....... 11 2.2 Longtermfleetplan................................ .. 12 2.3 Productandcontent............................... ... 14 2.4 TUIgether....................................... 14 2.5 Planningandproduction . .... 14 2.6 Longandmediumtermtrafficplanning . ...... 15 2.6.1 Maintenance ................................. 16 2.6.2 Slotsandtrafficrights . .. 19 2.6.3 Resourceplanning .............................. 19 2.7 Handling ....................................... 21 2.8 CrewPairing ..................................... 22 2.9 Dutylimitations................................. ... 25 2.10Pricing........................................ 26 v CONTENTS vi 3 System processes 28 3.1 Systemsdescription.............................. .... 29 3.1.1 IDPS ..................................... 30 3.1.2 SabreRocadeSuite.............................. 34 4 Airline Optimization 38 4.1 Scheduleplanning................................ ... 39 4.1.1 Scheduledesign ............................... 40 4.1.2 Fleetassignment ............................... 41 4.1.3 Aircraftrouting............................... 43 4.1.4 Crewscheduling ............................... 44 4.2 Backgroundforcombinedmodel . ..... 47 4.3 Simultaneous aircraft routing and crew scheduling . .............. 48 4.4 Solutionsuggestionfor an extended simultaneousaircraft routing and crew schedul- ingmodel ....................................... 53 5 Analysis 55 5.1 Softwareneed.................................... 56 5.2 Keyperformanceindicators. ...... 58 5.3 Riskmanagement.................................. 60 5.4 Multiobjectiveoptimization. ........ 63 6 Discussion 66 6.1 Checklistforminimumsoftwareperformance . .......... 66 6.2 ConclusionsfortheneedsofTUIflyNordic . ........ 67 6.3 Futureresearch .................................. .. 68 Bibliography 70 List of Figures 1.1 TheTUIsmiley.................................... 7 1.2 Cost structure comparison between short and long haul flights. ........... 8 2.1 PlanningprocessatTUIflyNordic . ...... 10 2.2 Timeframe in detail, overlooking several departments . ............... 11 2.3 Airplanesinproductionduring2010and2011. .......... 12 2.4 Decisionchainduringfleetplanningstage . .......... 13 2.5 Inputstotheair-trafficprogram. ........ 15 2.6 Resourcecalculationchain . ...... 20 2.7 Example of a current timelinefor flight deck planning. ............. 21 2.8 Pairingdemands.................................. .. 23 2.9 Inputsintocrewpairingstage. ....... 24 2.10 Rulesandregulationshierarchy. ......... 25 3.1 SystemoverviewatTUIflyNordic . ..... 28 3.2 Systems interconnectivity and modules currently at use atTUIflyNordic . 29 3.3 IDPSmoduleoverview .............................. .. 30 3.4 ScreenshotofArsisinterface. ....... 32 3.5 ScreenshotofOpsconinterface . ....... 33 3.6 ScreenshotofAirpasinterface . ....... 34 3.7 RM5moduleoverview ............................... 35 3.8 ScreenshotoftheRM5module:PARinterface. ......... 36 4.1 Scheduledesign.................................. .. 39 5.1 SystemsToday .................................... 56 5.2 Simpleflightscheduleexample. ...... 59 5.3 Riskparameters.................................. .. 61 5.4 Riskassessmentmodel ............................. ... 62 5.5 Riskmanagementactions. .... 63 5.6 Marginalallocationexample . ...... 65 vii List of Tables 1.1 CurrentfleetatTUIflyNordic. ..... 7 1.2 Exampleofrotationswithvariouscrewdemands. ........... 9 5.1 Keyperformanceindicators. ...... 58 1 Legsflownbyaircrafttypepermonth. ..... 73 viii 1 Introduction It’s not always easy to appreciate the workload that goes into planning an airplane route when you are stranded in an airport on the far-side of the planet waiting for that delayed flight home at the end of your two week vacation. However the effort behind planning aircraft rotations is an intricate process and it is a daily challenge to accommodate the needs of passengers in a changing environment, that make that two week vacation in, for instance Thailand, possible. The airline business is a competitive and ever-changing world where charter companies have to keep up with the rapid pace, forcing them to always provide the customers with high quality service and secure products at the same time. Air-traffic planning starts well over a year and a half before execution date and the process operates within very tight margins so that even small improvements in aircraft rotations efficiency can directly result in substantial cost reductions and savings. A fully operational air-traffic schedule is the result of compromises and sometimes negotiations between various and often opposing constraints. These constraints will be studied throughout the stages of this project. TUIfly Nordic has a growing need to rapidly evaluate and compare multiple traffic planning scenarios in order to determine and provide the customer (for TUIfly Nordic this customer is the Tour Operator) with an optimal choice of air-traffic schedule. There is also a need to generate economical estimates for each scenario that yield alternatives or contingency plans if one scenario should fail. Multiple traffic scenarios would also permit the planning department to measure gains or losses while following key performance indicators. The objective of this thesis is to provide an answer to this need. The methodology used to reach this solution begins with evaluating the current process followed by a recommendation that could allow for implementation of additional software to accommodate this need. This software shall present any consequences, economical or other, in a correct and easy way while also bridging the gap between certain planning process