IDEAS home Printed from https://ideas.repec.org/a/eee/transa/v137y2020icp187-205.html
   My bibliography  Save this article

Analysing travel mode and airline choice using latent class modelling: A case study in Western Australia

Author

Listed:
  • Zhou, Heng
  • Norman, Richard
  • Xia, Jianhong(Cecilia)
  • Hughes, Brett
  • Kelobonye, Keone
  • Nikolova, Gabi
  • Falkmer, Torbjorn

Abstract

This paper investigates travel mode and airline choice using stated-preference data. Both air and non-air passengers’ data were collected in Western Australia, which allows easier generalisability of the findings to a wider population. A market segmentation approach, using latent class modelling, was applied to identify passenger segments. The results shown a significant difference between identified segments in terms of demographics, economics and trip characteristics. One segment, comprising travellers with higher income and more frequent business travellers, was sensitive to service-factors. The other, comprising personal travellers with lower incomes, placed higher sensitivity on price. The findings highlight the importance of understanding mode choice behaviour based on market segmentation and provides insights to policy-makers and airlines for developing more effective polices and strategies.

Suggested Citation

  • Zhou, Heng & Norman, Richard & Xia, Jianhong(Cecilia) & Hughes, Brett & Kelobonye, Keone & Nikolova, Gabi & Falkmer, Torbjorn, 2020. "Analysing travel mode and airline choice using latent class modelling: A case study in Western Australia," Transportation Research Part A: Policy and Practice, Elsevier, vol. 137(C), pages 187-205.
  • Handle: RePEc:eee:transa:v:137:y:2020:i:c:p:187-205
    DOI: 10.1016/j.tra.2020.04.020
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0965856420305759
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.tra.2020.04.020?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Heckman, James & Singer, Burton, 1984. "A Method for Minimizing the Impact of Distributional Assumptions in Econometric Models for Duration Data," Econometrica, Econometric Society, vol. 52(2), pages 271-320, March.
    2. Lee, Joon-Kyu & Yoo, Kwang-Eui & Song, Ki-Han, 2016. "A study on travelers' transport mode choice behavior using the mixed logit model: A case study of the Seoul-Jeju route," Journal of Air Transport Management, Elsevier, vol. 56(PB), pages 131-137.
    3. Emily Lancsar & Jordan Louviere, 2008. "Conducting Discrete Choice Experiments to Inform Healthcare Decision Making," PharmacoEconomics, Springer, vol. 26(8), pages 661-677, August.
    4. Teichert, Thorsten & Shehu, Edlira & von Wartburg, Iwan, 2008. "Customer segmentation revisited: The case of the airline industry," Transportation Research Part A: Policy and Practice, Elsevier, vol. 42(1), pages 227-242, January.
    5. Bliemer, Michiel C.J. & Collins, Andrew T., 2016. "On determining priors for the generation of efficient stated choice experimental designs," Journal of choice modelling, Elsevier, vol. 21(C), pages 10-14.
    6. Ferrini, Silvia & Scarpa, Riccardo, 2007. "Designs with a priori information for nonmarket valuation with choice experiments: A Monte Carlo study," Journal of Environmental Economics and Management, Elsevier, vol. 53(3), pages 342-363, May.
    7. Román, Concepción & Espino, Raquel & Martín, Juan Carlos, 2007. "Competition of high-speed train with air transport: The case of Madrid–Barcelona," Journal of Air Transport Management, Elsevier, vol. 13(5), pages 277-284.
    8. Proussaloglou, Kimon & Koppelman, Frank S., 1999. "The choice of air carrier, flight, and fare class," Journal of Air Transport Management, Elsevier, vol. 5(4), pages 193-201.
    9. Bliemer, Michiel C.J. & Rose, John M. & Hensher, David A., 2009. "Efficient stated choice experiments for estimating nested logit models," Transportation Research Part B: Methodological, Elsevier, vol. 43(1), pages 19-35, January.
    10. Espino, Raquel & Martín, Juan Carlos & Román, Concepción, 2008. "Analyzing the effect of preference heterogeneity on willingness to pay for improving service quality in an airline choice context," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 44(4), pages 593-606, July.
    11. Louviere,Jordan J. & Hensher,David A. & Swait,Joffre D. With contributions by-Name:Adamowicz,Wiktor, 2000. "Stated Choice Methods," Cambridge Books, Cambridge University Press, number 9780521788304.
    12. Hess, Stephane & Adler, Thomas & Polak, John W., 2007. "Modelling airport and airline choice behaviour with the use of stated preference survey data," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 43(3), pages 221-233, May.
    13. Vij, Akshay, 2013. "Incorporating the Influence of Latent Modal Preferences in Travel Demand Models," University of California Transportation Center, Working Papers qt7nq9p0cv, University of California Transportation Center.
    14. Stephane Hess & John W. Polak, 2006. "Airport, airline and access mode choice in the San Francisco Bay area," Papers in Regional Science, Wiley Blackwell, vol. 85(4), pages 543-567, November.
    15. Jung, Se-Yeon & Yoo, Kwang-Eui, 2014. "Passenger airline choice behavior for domestic short-haul travel in South Korea," Journal of Air Transport Management, Elsevier, vol. 38(C), pages 43-47.
    16. William H. Greene & David A. Hensher, 2013. "Revealing additional dimensions of preference heterogeneity in a latent class mixed multinomial logit model," Applied Economics, Taylor & Francis Journals, vol. 45(14), pages 1897-1902, May.
    17. Jiang, Changmin & Zhang, Anming, 2016. "Airline network choice and market coverage under high-speed rail competition," Transportation Research Part A: Policy and Practice, Elsevier, vol. 92(C), pages 248-260.
    18. Vij, Akshay, 2013. "Incorporating the Influence of Latent Modal Preferences in Travel Demand Models," University of California Transportation Center, Working Papers qt7ng2z24q, University of California Transportation Center.
    19. Eric Ruto & Guy Garrod & Riccardo Scarpa, 2008. "Valuing animal genetic resources: a choice modeling application to indigenous cattle in Kenya," Agricultural Economics, International Association of Agricultural Economists, vol. 38(1), pages 89-98, January.
    20. Junyi Shen, 2009. "Latent class model or mixed logit model? A comparison by transport mode choice data," Applied Economics, Taylor & Francis Journals, vol. 41(22), pages 2915-2924.
    21. Hensher,David A. & Rose,John M. & Greene,William H., 2015. "Applied Choice Analysis," Cambridge Books, Cambridge University Press, number 9781107465923.
    22. Daniel McFadden & Kenneth Train, 2000. "Mixed MNL models for discrete response," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 15(5), pages 447-470.
    23. Inoue, Gaku & Ono, Masahiro & Uehara, Keita & Isono, Fumiaki, 2015. "Stated-preference analysis to estimate the domestic transport demand following the future entry of LCCs and the inauguration of the Linear Chuo Shinkansen in Japan," Journal of Air Transport Management, Elsevier, vol. 47(C), pages 199-217.
    24. Yang, Yuan & Wang, Can & Liu, Wenling & Zhou, Peng, 2018. "Understanding the determinants of travel mode choice of residents and its carbon mitigation potential," Energy Policy, Elsevier, vol. 115(C), pages 486-493.
    25. Wen, Chieh-Hua & Wang, Wei-Chung & Fu, Chiang, 2012. "Latent class nested logit model for analyzing high-speed rail access mode choice," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 48(2), pages 545-554.
    26. Riccardo Scarpa & Mara Thiene, 2005. "Destination Choice Models for Rock Climbing in the Northeastern Alps: A Latent-Class Approach Based on Intensity of Preferences," Land Economics, University of Wisconsin Press, vol. 81(3).
    27. Jovicic, Goran & Hansen, Christian Overgaard, 2003. "A passenger travel demand model for Copenhagen," Transportation Research Part A: Policy and Practice, Elsevier, vol. 37(4), pages 333-349, May.
    28. David Hensher & William Greene, 2003. "The Mixed Logit model: The state of practice," Transportation, Springer, vol. 30(2), pages 133-176, May.
    29. Peter Boxall & Wiktor Adamowicz, 2002. "Understanding Heterogeneous Preferences in Random Utility Models: A Latent Class Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 23(4), pages 421-446, December.
    30. Bliemer, Michiel C.J. & Rose, John M., 2011. "Experimental design influences on stated choice outputs: An empirical study in air travel choice," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(1), pages 63-79, January.
    31. Kenneth Train, 1980. "A Structured Logit Model of Auto Ownership and Mode Choice," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 47(2), pages 357-370.
    32. Bolduc, Denis, 1999. "A practical technique to estimate multinomial probit models in transportation," Transportation Research Part B: Methodological, Elsevier, vol. 33(1), pages 63-79, February.
    33. Greene, William H. & Hensher, David A., 2003. "A latent class model for discrete choice analysis: contrasts with mixed logit," Transportation Research Part B: Methodological, Elsevier, vol. 37(8), pages 681-698, September.
    34. Pels, Eric & Nijkamp, Peter & Rietveld, Piet, 2003. "Access to and competition between airports: a case study for the San Francisco Bay area," Transportation Research Part A: Policy and Practice, Elsevier, vol. 37(1), pages 71-83, January.
    35. Román, Concepción & Arencibia, Ana Isabel & Feo-Valero, María, 2017. "A latent class model with attribute cut-offs to analyze modal choice for freight transport," Transportation Research Part A: Policy and Practice, Elsevier, vol. 102(C), pages 212-227.
    36. Seelhorst, Michael & Liu, Yi, 2015. "Latent air travel preferences: Understanding the role of frequent flyer programs on itinerary choice," Transportation Research Part A: Policy and Practice, Elsevier, vol. 80(C), pages 49-61.
    37. Can, Vo Van, 2013. "Estimation of travel mode choice for domestic tourists to Nha Trang using the multinomial probit model," Transportation Research Part A: Policy and Practice, Elsevier, vol. 49(C), pages 149-159.
    38. Wen, Chieh-Hua & Lai, Shan-Ching, 2010. "Latent class models of international air carrier choice," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 46(2), pages 211-221, March.
    39. Chang, Li-Yen & Sun, Pei-Yu, 2012. "Stated-choice analysis of willingness to pay for low cost carrier services," Journal of Air Transport Management, Elsevier, vol. 20(C), pages 15-17.
    40. Yuanqing Wang & Lei Li & Li Wang & Adrian Moore & Samuel Staley & Zongzhi Li, 2014. "Modeling traveler mode choice behavior of a new high-speed rail corridor in China," Transportation Planning and Technology, Taylor & Francis Journals, vol. 37(5), pages 466-483, July.
    41. Joan Walker & Jieping Li, 2007. "Latent lifestyle preferences and household location decisions," Journal of Geographical Systems, Springer, vol. 9(1), pages 77-101, April.
    42. Greene, William & Harris, Mark N. & Hollingsworth, Bruce & Maitra, Pushkar, 2014. "A latent class model for obesity," Economics Letters, Elsevier, vol. 123(1), pages 1-5.
    43. Pengpeng Jiao & Meiqi Liu & Jin Guo, 2015. "Integrated Model of Joint Residence-Workplace Location Choice and Commute Behavior Using Latent Class and Mixed Logit Methods," Discrete Dynamics in Nature and Society, Hindawi, vol. 2015, pages 1-9, April.
    44. Chen, Hsi-Tien & Chao, Ching-Cheng, 2015. "Airline choice by passengers from Taiwan and China: A case study of outgoing passengers from Kaohsiung International Airport," Journal of Air Transport Management, Elsevier, vol. 49(C), pages 53-63.
    45. Boxall, Peter C. & Adamowicz, Wiktor L., 1999. "Understanding Heterogeneous Preferences in Random Utility Models: The Use of Latent Class Analysis," Staff Paper Series 24090, University of Alberta, Department of Resource Economics and Environmental Sociology.
    46. D’Alfonso, Tiziana & Jiang, Changmin & Bracaglia, Valentina, 2015. "Would competition between air transport and high-speed rail benefit environment and social welfare?," Transportation Research Part B: Methodological, Elsevier, vol. 74(C), pages 118-137.
    47. Chandra R. Bhat, 1997. "An Endogenous Segmentation Mode Choice Model with an Application to Intercity Travel," Transportation Science, INFORMS, vol. 31(1), pages 34-48, February.
    48. Pels, Eric & Nijkamp, Peter & Rietveld, Piet, 2000. "Airport and Airline Competition for Passengers Departing from a Large Metropolitan Area," Journal of Urban Economics, Elsevier, vol. 48(1), pages 29-45, July.
    49. Vij, Akshay & Carrel, André & Walker, Joan L., 2013. "Incorporating the influence of latent modal preferences on travel mode choice behavior," Transportation Research Part A: Policy and Practice, Elsevier, vol. 54(C), pages 164-178.
    50. Zhou, Heng & Xia, Jianhong & Norman, Richard & Hughes, Brett & Nikolova, Gabi & Kelobonye, Keone & Du, Kai & Falkmer, Torbjorn, 2019. "Do air passengers behave differently to other regional travellers?: A travel mode choice model investigation," Journal of Air Transport Management, Elsevier, vol. 79(C), pages 1-1.
    51. Hess, Stephane & Polak, John W., 2006. "Exploring the potential for cross-nesting structures in airport-choice analysis: A case-study of the Greater London area," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 42(2), pages 63-81, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Siliang Luan & Qingfang Yang & Zhongtai Jiang & Huxing Zhou & Fanyun Meng, 2022. "Analyzing Commute Mode Choice Using the LCNL Model in the Post-COVID-19 Era: Evidence from China," IJERPH, MDPI, vol. 19(9), pages 1-26, April.
    2. Ren, Xinhui & Pan, Na & Jiang, Hong, 2022. "Differentiated pricing for airline ancillary services considering passenger choice behavior heterogeneity and willingness to pay," Transport Policy, Elsevier, vol. 126(C), pages 292-305.
    3. Nael Alsaleh & Bilal Farooq & Yixue Zhang & Steven Farber, 2021. "On-Demand Transit User Preference Analysis using Hybrid Choice Models," Papers 2102.08256, arXiv.org, revised Aug 2023.
    4. Kim, Sung Hoo & Mokhtarian, Patricia L., 2023. "Finite mixture (or latent class) modeling in transportation: Trends, usage, potential, and future directions," Transportation Research Part B: Methodological, Elsevier, vol. 172(C), pages 134-173.
    5. Lee, Jaehyung & Lee, Euntak & Yun, Jaewoong & Chung, Jin-Hyuk & Kim, Jinhee, 2021. "Latent heterogeneity in autonomous driving preferences and in-vehicle activities by travel distance," Journal of Transport Geography, Elsevier, vol. 94(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhou, Heng & Norman, Richard & Kelobonye, Keone & Xia, Jianhong (Cecilia) & Hughes, Brett & Nikolova, Gabi & Falkmer, Torbjorn, 2020. "Market segmentation approach to investigate existing and potential aviation markets," Transport Policy, Elsevier, vol. 99(C), pages 120-135.
    2. Kim, Sung Hoo & Mokhtarian, Patricia L., 2023. "Finite mixture (or latent class) modeling in transportation: Trends, usage, potential, and future directions," Transportation Research Part B: Methodological, Elsevier, vol. 172(C), pages 134-173.
    3. Sanjana Hossain & Md. Sami Hasnine & Khandker Nurul Habib, 2021. "A latent class joint mode and departure time choice model for the Greater Toronto and Hamilton Area," Transportation, Springer, vol. 48(3), pages 1217-1239, June.
    4. Jing Lu & Cheng Lv & Zhongzhen Yang & Mark Hansen, 2019. "Market Segmentation of New Gateway Airports Incorporating Passengers’ Curiosity," Sustainability, MDPI, vol. 11(24), pages 1-24, December.
    5. Hurtubia, Ricardo & Nguyen, My Hang & Glerum, Aurélie & Bierlaire, Michel, 2014. "Integrating psychometric indicators in latent class choice models," Transportation Research Part A: Policy and Practice, Elsevier, vol. 64(C), pages 135-146.
    6. Khakdaman, Masoud & Rezaei, Jafar & Tavasszy, Lóránt A., 2020. "Shippers’ willingness to delegate modal control in freight transportation," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 141(C).
    7. Haghani, Milad & Bliemer, Michiel C.J. & Hensher, David A., 2021. "The landscape of econometric discrete choice modelling research," Journal of choice modelling, Elsevier, vol. 40(C).
    8. Sfeir, Georges & Abou-Zeid, Maya & Rodrigues, Filipe & Pereira, Francisco Camara & Kaysi, Isam, 2021. "Latent class choice model with a flexible class membership component: A mixture model approach," Journal of choice modelling, Elsevier, vol. 41(C).
    9. Krueger, Rico & Rashidi, Taha H. & Vij, Akshay, 2020. "A Dirichlet process mixture model of discrete choice: Comparisons and a case study on preferences for shared automated vehicles," Journal of choice modelling, Elsevier, vol. 36(C).
    10. Franceschinis, Cristiano & Thiene, Mara & Scarpa, Riccardo & Rose, John & Moretto, Michele & Cavalli, Raffaele, 2017. "Adoption of renewable heating systems: An empirical test of the diffusion of innovation theory," Energy, Elsevier, vol. 125(C), pages 313-326.
    11. Kim, Sung Hoo & Mokhtarian, Patricia L., 2018. "Taste heterogeneity as an alternative form of endogeneity bias: Investigating the attitude-moderated effects of built environment and socio-demographics on vehicle ownership using latent class modelin," Transportation Research Part A: Policy and Practice, Elsevier, vol. 116(C), pages 130-150.
    12. Sergio Colombo & Nick Hanley & Jordan Louviere, 2009. "Modeling preference heterogeneity in stated choice data: an analysis for public goods generated by agriculture," Agricultural Economics, International Association of Agricultural Economists, vol. 40(3), pages 307-322, May.
    13. de Luca, Stefano, 2012. "Modelling airport choice behaviour for direct flights, connecting flights and different travel plans," Journal of Transport Geography, Elsevier, vol. 22(C), pages 148-163.
    14. Catalina M. Torres & Sergio Colombo & Nick Hanley, 2014. "Incorrectly accounting for preference heterogeneity in choice experiments: what are the implications for welfare measurement?," DEA Working Papers 65, Universitat de les Illes Balears, Departament d'Economía Aplicada.
    15. Angel Bujosa & Antoni Riera & Robert Hicks, 2010. "Combining Discrete and Continuous Representations of Preference Heterogeneity: A Latent Class Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 47(4), pages 477-493, December.
    16. Beharry-Borg, Nesha & Scarpa, Riccardo, 2010. "Valuing quality changes in Caribbean coastal waters for heterogeneous beach visitors," Ecological Economics, Elsevier, vol. 69(5), pages 1124-1139, March.
    17. Fowri, Hamid R. & Seyedabrishami, Seyedehsan, 2020. "Assessment of urban transportation pricing policies with incorporation of unobserved heterogeneity," Transport Policy, Elsevier, vol. 99(C), pages 12-19.
    18. Xuemei Fu & Zhicai Juan, 2017. "Accommodating preference heterogeneity in commuting mode choice: an empirical investigation in Shaoxing, China," Transportation Planning and Technology, Taylor & Francis Journals, vol. 40(4), pages 434-448, May.
    19. Yoo, James & Ready, Richard C., 2014. "Preference heterogeneity for renewable energy technology," Energy Economics, Elsevier, vol. 42(C), pages 101-114.
    20. Marcucci, Edoardo & Gatta, Valerio, 2011. "Regional airport choice: Consumer behaviour and policy implications," Journal of Transport Geography, Elsevier, vol. 19(1), pages 70-84.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:transa:v:137:y:2020:i:c:p:187-205. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/547/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.