This paper presents an optimization model using stochastic programming to secure the optimum seat and maximizing the profit of the airline in consideration of overbooking. Airline seat inventory control involves selling the right seats to the right people at the right time. If an airline sells tickets on a first-come, first-serve basis, it is likely to be occupied by leisure travelers and late bookers. Generally, business travelers willing to pay a higher fare will subsequently find no seats left, and revenue from such sales will be lost. The airline allows overbooking, accepting more reservations than seats to minimize losses. While there are various needs that depend on the type of passenger, we propose an optimization model using stochastic programming as a method of maximizing the profit of the airline company by securing seats appropriately and employing the concept of overbooking.
Revenue Management Problem via Stochastic Programming in the Aviation Industry
Lect. Notes in Networks, Syst.
International Conference on Modelling, Computation and Optimization in Information Systems and Management Sciences ; 2021 ; Hanoi, Vietnam December 13, 2021 - December 14, 2021
Modelling, Computation and Optimization in Information Systems and Management Sciences ; Kapitel : 13 ; 145-157
08.12.2021
13 pages
Aufsatz/Kapitel (Buch)
Elektronische Ressource
Englisch
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