Civil aviation, including commercial carriage by air, airports, and aircraft manufacturing, has different challenges as well as opportunities for the significant improvement of airline marketing, airport design, passenger flow management, and production processes.
Using simulation, the stakeholders can identify the best business strategies and implement them for higher profitability and greater passenger satisfaction.
In this blog post, we will talk about the efficient solutions that can be found for civil aviation with the use of AnyLogic simulation models.
Contents:
- Civil aviation problems and opportunities: brief overview
- Aircraft production planning
- Airport design software for capacity management
- Airline marketing and sales funnel simulation
- To sum up: why the aviation market benefits from using simulation
Сivil aviation problems and opportunities: brief overview
In 2023, the airline industry is expected to drive profitability, according to the Global Outlook for Air Transport by the International Air Transport Association (IATA). Airlines managed to cut their losses significantly in 2022 and are predicted to become commercially successful this year. Profits are expected to reach $4.7 billion in 2023. This could be a substantial improvement over pandemic times, when the industry realized losses of $137.7 billion in 2020 and $42 billion in 2021.
However, not all airline companies are becoming profitable. Some of them are struggling for various reasons, namely high fuel prices, a few no-fly zones, and regular flight delays.
Among other challenges, the airline industry faces climate change and environmental issues, which were raised at the recently held Davos Forum 2023. Since commercial aviation provides nearly 3% of global carbon dioxide emissions, it is taking some measures to reduce the environmental impact of air travel. For instance, Airbus said that it would develop the world's first commercial aircraft fueled by hydrogen by 2035.
Meanwhile, replacing jet fuel with hydrogen or “green fuel” made from renewable sources will have a significant impact on an airline company’s finances. The aviation market needs to take some actions in advance to decrease current costs for the sake of these future initiatives.
Airports also have problems, such as increases in passenger traffic resulting in airport congestion. The optimization of resource allocation, capacity, and airport operations is becoming more important to reduce operational costs with respect to demand.
Commercial aviation needs to implement new approaches to enhance efficiency, profitability, and passenger loyalty.
Airline marketing and sales funnel simulation
To increase profit in the hyper-competitive environment, the management of a commercial airline made long-term decisions regarding fleet sizes, airline marketing, and fuel prices.
Thanks to AnyLogic simulation software, the major U.S. airline was able to understand how the interaction between different factors (i.e., fare utility, experience, loyalty, and word of mouth) may influence market share and modify markets overall.
The developed consumer behavior model of multiple airline markets included client competition, the process of consumers making choices, and a relatively complete representation of the ecosystem in each market.
This simulation model showed the impact of additional fees on customers’ purchase behavior and the airline’s social contract. Using AnyLogic software, the airline management could analyze the sales funnel at a particular segment and individual competitor level.
Eventually, simulation results helped managers understand that losses in market share and revenue over the long term would exceed the gains from charging additional fees.
Aircraft production planning
In order to have a great reputation and remain ahead of the competition, an airline needs to ensure that its aircraft are periodically upgraded and maintained.
Production of a new aircraft is a difficult process, that requires analysis of management strategies and continuous evaluation of the product and production processes. To meet the challenges of increasingly frequent ramp-ups, the Airbus Group tested multiple scenarios with different sets of production plans using simulation modeling.
The developers ran the simulation to investigate the effects of the disturbance mitigation strategies applied at the Airbus facility. The AnyLogic model enabled the Airbus Group to compare the plans with current management practices.
Airport design software for capacity management
Airports also need consistent upgrades and modernization. Airport design software is a perfect solution for managing passenger flows as well as creating baggage handling systems. AnyLogic software enables stakeholders to build predictive airport planning models, choose the most efficient airport design, and maximize resource utilization, including people, baggage, and vehicles.
Airport passenger flow simulation
Passenger flow simulations can be created as part of airport optimization using AnyLogic software. Optimization of airport processes and waiting time reduction are significant for the improvement of airport capacity and passenger satisfaction.
The terminal management of Frankfurt Airport had successfully used AnyLogic to build a model of the airport and optimize airport passenger flow. The simulation model provided the required accuracy for forecasting and planning.
One more use case of simulation software is the analysis of how the introduction of a new flight would influence the terminal capacity of LaGuardia Airport. A crowd simulation model of the southwest terminal was built to examine the use of seats under different scenarios.
The basic model, without the introduction of the new flight, displayed the operation of all terminal areas before the changes. Then engineers could test various assumptions against this model, including how far passengers would have to move away from the gates to wait for their departure.
Airport baggage system simulation
Montreal International Airport intended to launch several infrastructure projects to meet the anticipated growth in demand for support services, including an Early Bag Storage (EBS) system.
The EBS operations were developed with the help of the simulation model. AnyLogic simulation tool allowed the airport’s stakeholders to make better, more timely decisions and identify solutions. This helped the airport avoid numerous costs related to poor service quality.
Using AnyLogic as airport design software, Montreal International Airport managed to maintain its service levels throughout the transformation process and meet the increased demand.
Montreal International Airport also worked on a Smart Baggage Handling System (BHS). With the help of AnyLogic, the BHS was modeled with more than 1000 conveyors and more than 100 decision points. This simulated system produced over 2.8 million daily decisions. The airport design software was used as a rapid decision-making tool for operations and planning.
The developed AnyLogic model helped to reach the target practical capacity on a consistent basis. In addition, the stakeholders increased service levels at the airport, which led to greater passenger satisfaction. On top of that, airport management could observe efficiency gains using AnyLogic software.
To sum up: why the aviation market benefits from using simulation
The civil aviation processes can be significantly improved by using simulation and optimization for aircraft production, airport passenger flow management, airport design, as well as airline marketing.
Airport infrastructure, including terminals, runways, lounges, etc., needs to be consistently upgraded to cope with air passenger traffic. AnyLogic, as airport planning software, is an effective tool to simulate airport design and operations, as well as resource allocation.
While civil aviation faces challenges in 2023, it has the capability to implement simulation-based optimization that will lead to its profitability and passenger loyalty.
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