Airport Operations Assignment -

Question 1 &2 are from the Delays at Boston Logan Case -

Q1- Answer the first 2 Questions from the Problem Set provided (also on Moodle). (Explain /show your assumptions)

Problem 1 - In the Delays at Logan Airport case, we discussed various proposals for reducing congestion at Logan Airport. One method for mitigating the impact of delays was peak-period pricing. In the case normal, good weather operational capacity (i.e., both arrivals and departures) hovered around 120 planes per hour. Assuming (as is customarily the case) that the number of arrivals roughly equals the number of departures, this implies an average arrival capacity of 60 planes per hour. Though three runways total are in operation during good weather, only two are used for arrivals, which implies that each arrival runway has an hourly capacity of 30 planes per hour. During the peak period, arrival rates generally range from 44.5 planes per hour to a little over 60 planes per hour.

The Federal Aviation Administration (FAA) has estimated that delays cost airlines around 5348 on average per plane per hour in both airplane operating costs and extra ground crew time for a 19 seat turboprop plane, and 51,585 for a representative 150-seat plane. Assume that the corresponding cost for regional jets is 5640 per hour. This number does not, however, include the costs to airline passengers created by delays (such as missed meetings, events, or inconvenience), some of which may be borne by airlines in terms of foregone revenue, as frustrated passengers shift to alternative means of transportation or forego travel altogether. The Air Transport Association (a major airline industry group), has, however, used a 525.70 per hour estimate as the value of a passenger's time in its estimates of annual costs delay costs.

The FAA also only deems a flight delayed if the flight arrives or departs more than fifteen minutes past schedule.

a. Assume normal, good weather capacity, and a 70% passenger load factor. Using the attached Excel exercise, what are the per plane delay times and operational and passenger delay costs associated with arrival rates of 50 planes per hour, for all three types of planes mentioned? At 55 planes per hour? At 59?

b. How would your answers to a. change if we used the FAA's definition of delay? Does this definition of delay appear more or less reasonable?

c. Based on your analysis, do you believe peak period pricing, by reducing arrival rates during periods of heavy demand, might represent an effective means of reducing the costs of over scheduling?

Problem 2 - Clearly, peak periods exist for a reason; that is, they are not random fluctuations but rather exist due to passengers' desires for landings and takeoffs at certain choice periods during the day. As such, for fear of angering their customers, airlines will only shift flights to different period during the day if the costs of incurring peak charges outweigh the costs (in terms of lost revenue) of shifting flights to off-peak periods.

An operating expense breakdown for three airplane classes is listed in Exhibit 1. In addition, per passenger revenue for different aircraft sizes is listed in Exhibit 2. Assume all planes fly with 30% of passenger seats empty (i.e., assume a 70% load factor).

a. For which airplane types listed above (conventional jet, regional jet, and turboprop) would a peak-period landing fee of $100 have a significant economic impact? What about a $150 fee? What about $200?

b. Based on your answer to 2(a), whether peak period pricing has a significant effect on the magnitude of delays may depend on the particular mix of airplane classes utilizing Logan during a peak hour. Do you believe peak period pricing would have a significant effect if the typical airplane mix were 40% turboprop, 18% regional jet, and 42% conventional jet, as it approximately currently stands at Logan? What about 20% turboprop, 30% regional jet, and 50% conventional jet, as one future scenario for 2015 envisioned by Massport/FAA has it?

c. To what extent might savings in delay costs that result from demand management offset peak period fees?

Q2- What would be your Overall recommendation to the FAA for the City of Boston

• Allow Massport to build a new Runway?
• Insist that Massport institute peak-period pricing?
• Do Both?
• Do neither?

(Critically analyze of each of the scenarios)

Questions 3-6 are from the Cochin Airport Case

Q3- How Serious are CIAL's financial Difficulties? (Analyze CIAL's Finances).

Q4- What should Rajeev do to try to put the airport on a more profitable footing? (Provide & analyze at least 3 possible actions Rajeev could take to improve things).

Q5- Should a facility like CIAL be self-supporting from user charges? What are the Pro's and Con's?

Q6- Should a facility like CIAL be built and operated by the private sector or public sector? (Critically Analyze Public vs. Private ownership).

Questions 7 & 8 are from the Perfect Storm over the Zurich Airport Case

Q7- What was the Perfect Storm in 2001? (list the issues that created the storm and how they affected Zurich Airport).

Q8- What does it take to manage over a sustained crisis? How well did Felder do? (Analyze Felder's Actions during the crisis).

Questions 9 and 10 are from the Orlando MCO Case

Q9- What other Airports compete with Orlando MCO for business? How Large of a threat are these Airports to MCO? (Critically analyze the threat).

Q10- What is MCO's Value Proposition to Airlines? Assume you are with Emirates route planning; is MCO's Value Proposition appealing? (Critically analyze MCO's Value Proposition).

Attachment:- Assignment Files.rar