Delay at Logan Airport Case Analysis

1682 Words Apr 2nd, 2015 7 Pages
Course: Operation Management
Delays at Logan Airport Problem set Analysis
Problem #1
a. Assume normal, good weather capacity and a 70% passenger load factor. Using the attached Excel exercise, what are the pre 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? | Delay Dollars per person per hour | 70% Load factor | Delay cost per hr | Total Delay Cost / hour | Total Delay Cost / minute | Turboprop | $25.70 | 13.3 | $348.00 | $689.81 | $11.50 | Regional | $25.70 | 35 | $640.00 | $1,539.50 | $25.66 | Conventional | $25.70 | 105 | $1,585.00 | $4,283.50 | $71.39 |

Total
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According to the FAA’s definition of delay, there will be delay cost only when arrival rate is 59 planes per hour and the delay time is 60.5-15=45.5 min. This definition appears less reasonable, because it ignores the delay cost when the arrival rate is either 50 planes per hour or 55 planes per hour. According to the diagram in the attached Excel, The flight arrives or departs more than 10 minutes should be defined as delay.
c. Based on your analysis, do you believe peak period pricing, by reducing arrival rates during period of heavy demand, might represent and effective means of reducing the costs of over scheduling? I believe that peak-period pricing will be effective means of reducing the costs of over scheduling. As we can see in the calculation above, the delay cost dramatically increase when arrival rate increases.
Problem #2
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? | Turboprop | Regional jet | Conventional jet | Estimated revenue per passenger | $230 | $154 | $402 | Capacity*70% load factor | 13.3 | 35 | 105 | Revenue per plane | 3,059 | 5,390 | 42,210 | Landing fees % of revenue: | | | | $100 landing fee | 100/3,059=3.27% | 1.86% | 0.24% | $150 landing fee | 4.9% | 2.78% | 0.355% | $200 landing fee | 6.54% | 3.71% | 0.47% | The data above shows that for all three