Module: TH60123E – Air Route Planning
Assessment 2: Individual Written Report – Further Guidance
Assessment Title: European Short-haul Route Analysis
All airlines have complex route networks that connect passengers and freight between airports. An airline could have more than 1000 routes in the network for any one season. The performance of each route is measured in terms of profitability which airlines monitor on a regular basis. Capacity on profitable routes is often increased and can be crucial to the airline. However not all routes are successful and underperforming routes may have capacity reduced or may even be dropped altogether. Route performance is dynamic and can change quickly due to changes in passenger demand, variations in operating costs and changes to competition on the route due to other airline operators.
As part of this assignment, you are assuming the role of a route analyst working for easyJet airlines. The airline is working on a large project to review the routes operated across their network. They are looking to drop some less profitable routes so that they can deploy aircraft on more successful routes. You have been asked by your manager to conduct a commercial and operational analysis for a specific route to assess its viability. You are to write a 2000-word report (±10%) including the following sections:
• Demand and Revenue Analysis
• Cost and Operational Analysis
• Route Recommendation
easyJet currently has 1951 flight sectors and more than 800 routes scheduled. A full list is available at https://www.easyjet.com/en/cheap-flights/timetables.
You may select any route of your choice from this list and analyse it for this report.
You may find it useful to read airline management books and journal articles. You are also strongly encouraged to use airline databases such as CAPA to research information about the route.
In addition to the assessment brief, this document provides you with further guidance about how you could conduct the route analysis.
For the route you are analysing you should consider some of the following points:
Demand Analysis
• What type of destination would you categorise the route? (e.g. leisure, business, VFR or a mix). How will this impact the potential revenue for the route?
• How is the passenger demand likely to vary throughout the year (seasonal variation)?
• Are there any events, national holidays, celebrations at the origin & destination on specific dates where demand is likely to increase?
• How is COVID-19 impacting travel demand? What are the travel restrictions of the origin & destination country?
• What is the economic situation of the countries connected by the route? You could research unemployment rates, GDP etc.
• What is the average cost of living/visiting the destination when taking into consideration currency exchange rates? You could research average hotel prices, food and drink, local transport cost etc at the destination. How does this impact demand?
• What is the catchment size of the local population?
• Are there any safety and security concerns about the destination? Is there a history of terrorist attacks, natural disasters that could deter passengers from travelling there?
Revenue Analysis
• How will the mix of passengers impact the revenue potential of the route?
• How does the price of tickets vary throughout the day/week/year?
• Who are the competitor airlines and how are they competing? Do the competitors operate direct, non-stop, connecting flights? How do the flight schedules of the competitors compare to easyJet’s flight schedule?
• What are the unique selling points about the easyJet flights that enable it then to generate more revenue?
• What is the potential for ancillary revenue on the route?
• Are there other modes of transport (substitutes) that connect the route? If so, how does the price of using these other transport services compare to easyJet prices?
Overall, what are the strengths, weaknesses, opportunities and threats (SWOTs) of the route in terms of demand and revenue?
Cost and Operational Analysis
• What are the likely operating costs of the route? Consider easyJet’s financial reports to estimate costs.
• Are there any crew constraints that would adversely impact the operating costs?
• How could easyJet reduce their costs to maintain profitability?
• Would operating the route cause a negative impact on aircraft utilisation/ productivity?
• Are there any operational constraints at the destination airport such as congestion, shortage of stands, very short runways?
• Is the destination frequently impacted by adverse weather that could cause disruption to flights?
• What is the availability of nearby alternative airports in case of diversion?
And finally:
• Remember to conclude your report with recommendations that will increase revenue and reduce costs.
• The more detailed your analysis, the more marks you are likely to achieve.
• You should use charts, tables and diagrams wherever appropriate to present information and evidence.
• Please ensure that any data taken from external sources is cited and referenced in the report.
• In terms of report structure and presentation, ensure you separate the report into numbered sections and subsections, label figures and tables, proof-read your report to identify and correct spelling and grammatical errors prior to submission.
Good Luck!
