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Airline's choice of aircraft size - Explanations and implications

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Author Info

  • Givoni, Moshe
  • Rietveld, Piet

Abstract

When facing a growth in demand, airlines tend to respond more by means of increasing frequencies than by increasing aircraft size. At many of the world's largest airports there are fewer than 100 passengers per air transport movement, although congestion and delays are growing. Furthermore, demand for air transport is predicted to continue growing but aircraft size is not. This paper aims to investigate and explain this phenomenon, the choice of relatively small aircraft. It seems that this choice is associated mainly with the benefits of high frequency service, the competitive environment in which airlines operate and the way airport capacity is allocated and priced. Regression analysis of over 500 routes in the US, Europe and Asia provides empirical evidence that the choice of aircraft size is mainly influenced by route characteristics (e.g. distance, level of demand and level of competition) and almost not at all by airport characteristics (e.g. number of runways and whether the airport is a hub or slot coordinated). We discuss the implications of this choice of aircraft size and suggest that some market imperfections exist in the airline industry leading airlines to offer excessive frequency on some routes and too low frequency on others.

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Bibliographic Info

Article provided by Elsevier in its journal Transportation Research Part A: Policy and Practice.

Volume (Year): 43 (2009)
Issue (Month): 5 (June)
Pages: 500-510

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Handle: RePEc:eee:transa:v:43:y:2009:i:5:p:500-510

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Related research

Keywords: Air transport Aircraft size Airline competition Service frequency;

References

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Citations

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Cited by:
  1. Flores-Fillol, Ricardo, 2010. "Congested hubs," Transportation Research Part B: Methodological, Elsevier, vol. 44(3), pages 358-370, March.
  2. Zhang, Qiong & Yang, Hangjun & Wang, Qiang & Zhang, Anming, 2014. "Market power and its determinants in the Chinese airline industry," Transportation Research Part A: Policy and Practice, Elsevier, vol. 64(C), pages 1-13.
  3. Evans, Antony & Schäfer, Andreas, 2011. "The impact of airport capacity constraints on future growth in the US air transportation system," Journal of Air Transport Management, Elsevier, vol. 17(5), pages 288-295.
  4. Fukui, Hideki, 2012. "Do carriers abuse the slot system to inhibit airport capacity usage? Evidence from the US experience," Journal of Air Transport Management, Elsevier, vol. 24(C), pages 1-6.
  5. Liu, Yi & Hansen, Mark & Zou, Bo, 2013. "Aircraft gauge differences between the US and Europe and their operational implications," Journal of Air Transport Management, Elsevier, vol. 29(C), pages 1-10.
  6. Low, Joyce M.W. & Lee, Byung Kwon, 2014. "Effects of internal resources on airline competitiveness," Journal of Air Transport Management, Elsevier, vol. 36(C), pages 23-32.
  7. Martijn B.W. Kobus & Jos N. van Ommeren & Hans R.A. Koster & Piet Rietveld, 2013. "Congestible Goods and Hoarding: A Test based on Students' Use of University Computers," Tinbergen Institute Discussion Papers 13-083/VIII, Tinbergen Institute.
  8. Dobruszkes, Frédéric, 2011. "High-speed rail and air transport competition in Western Europe: A supply-oriented perspective," Transport Policy, Elsevier, vol. 18(6), pages 870-879, November.
  9. Vespermann, Jan & Wald, Andreas, 2011. "Much Ado about Nothing? – An analysis of economic impacts and ecologic effects of the EU-emission trading scheme in the aviation industry," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(10), pages 1066-1076.
  10. Givoni, Moshe & Rietveld, Piet, 2010. "The environmental implications of airlines' choice of aircraft size," Journal of Air Transport Management, Elsevier, vol. 16(3), pages 159-167.

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