Considering competition to solve a flight schedule and aircraft routing problem for small airlines

For the case of low-cost airlines, which are characterized by having a single fleet with a small number of airplanes, in a previous work, a heuristic algorithm (AFS-MRA) was developed to simultaneously find the flight schedule and the aircraft routes subject to maintenance constraints. This work advances this algorithm by incorporating competition in the planning process (MAFS-MRA). Within a time frame with a given demand data, competition is seen as a game with two players (one airline and all its competitors), where the strategies are all the potential origin-destinations that could be included in the flight schedule, and the payment matrix contains the objective function coefficients that depend on the market share and the routes previously selected. Numerical experimentation was undertaken using real data for the case of two airlines that operate at Toluca International Airport in Mexico. It was found that, by considering competition, the occupation improves to 3% and that the number of flights required to satisfy the demand was reduced to 21%. Besides, the updating process reduces the profit computation error in almost 80%, as compared to the real market behavior for the period under study.