THE IMPACT OF ON TIME PERFORMANCE ON OPERATION MANAGEMENT AND PASSENGER LOYALTY TO AIRLINES.

REEFEAR EAPEAR ANAK AJANG

MASWEERA BIN MAHADI

NOR AKILAH BT MOHD AMIR

NORAMALINA ZULKIFLI

MUGAMBIGAI D/O MURUGAN

UMMI SAKINAH BINTI MOHAMED NOR

Introduction

• On time performance commonly referred to as “OTP” is a standard aviation measurement to track the day-to-day performance of an airline.

• OTP is also a measurement of our ability not only to operate the planes safely and on time but also to consolidate multiple customer's shipments, accurately load, unload, connect, deconsolidate and deliver them through their extensive flight network to customers on time.

• On-time performance refers to the level of success of the service remaining on the published schedule.

• On time performance is measured as the number of flights operating on time as a percentage of the number of flights operated on any particular sector.

MEASUREMENT OF OTP

Terms ExplanationOn time departure(D15)

A flight departure is counted as "on time" if it departs the gate within 15 minutes of the scheduled departure time shown in the carriers' schedule.

On time arrival (A14)

A flight arrival is counted as "on time" if it arrived at the gate within 15 minutes of the scheduled arrival time shown in the carriers' schedule. Neither diverted nor cancelled flights count as on time.

Cancellation A flight is regarded as a cancellation if it is cancelled or rescheduled less than 7 days prior to its scheduled departure time.

On time departure percentage

The percentage of on time departures is measured against the number of departures operated on any particular sector.

On time arrival percentage

The percentage of on time arrivals is measured against the number of arrivals operated on any particular sector.

Cancellation percentage

The percentage of cancellations is measured against the number of services scheduled on any particular sector.

Factors that effect OTP

• Air Traffic Clearances• Passengers• Weather• Technical Defects

ON TIME PERFORMANCE STATISTICS FOR NORTHAMERICAN REGION

Presented by:Amalina Zulkifli

North American Region 2013

North American Region 2014

North American Region Jan 2015

ON TIME PERFORMANCE STATISTICS FOR EUROPE REGION

Presented by:Akilah Mohd Amir

Europe Region 2013

Europe Region 2014

Europe Region Jan 2015

ON TIME PERFORMANCE STATISTICS FOR ASIAN-PACIFIC REGION

Presented by:Masweera Mahadi

Asian Region 2013

Asian Region 2014

Asian Region Jan 2015

Future on time performance

Presented by:Reefear Eapear

FUTURE ANALYSIS OF OTP

On Time Performance (%) Schedule Flights

Airlines Jan Feb March Jan Feb March

JAL 86.54 90.23 90.20 22,815 20,521 22,815Air Asia 86.53 84.78 83.52 13,761 12,454 14,035Malaysia Airlines 82.51 82.13 82.61 16,262 14,742 16,269ANA 84.81 89.99 89.14 37,315 33,755 37,459Alaska Airlines 85.22 87.83 86.82 27,092 24,662 28.569American Airlines 72.77 72.32 75.25 106,169 96,132 108,991Delta Air Lines 82.88 77.92 82.33 145,993 133,902 160,398WestJet 73.05 75.66 84.85 17,011 15,538 17,359Iberia 92.72 92.33 92.48 13,750 13,010 14,982Lufthansa 83.49 82.80 86.60 37,217 36,673 42,084Aeroflot 84.91 89.51 94.39 22,591 20,510 22,943KLM 81.28 90.53 83.08 17,013 15,862 18,920

FUTURE ANALYSIS OF OTP

ASIA-PACIFIC REGION

January February March April May June July August September October November December80.00%

81.00%

82.00%

83.00%

84.00%

85.00%

86.00%

87.00%

11,500

12,000

12,500

13,000

13,500

14,000

14,50086.53%

84.78%

83.52%0.8352

0.8247

0.84090.8512

13,761

12,454

14,035

AIR ASIA

OTP Schedule Flights

North American Region

January February March April May June July August September October November December83.00%

84.00%

85.00%

86.00%

87.00%

88.00%

89.00%

90.00%

22,000

23,000

24,000

25,000

26,000

27,000

28,000

29,000

85.22%

87.83%

86.82% 0.8626

0.891

0.8795

27,092

24,662

28,569

Alaska Airl ines

OTP Schedule Flight

Europe Region

January February March April May June July August September October November December90.50%

91.00%

91.50%

92.00%

92.50%

93.00%

93.50%

94.00%

94.50%

95.00%

95.50%

12,000

12,500

13,000

13,500

14,000

14,500

15,000

15,500

92.72%92.33%

92.48%0.9248 0.9223

0.9322

0.94670.9488 0.9512

13,750

13,010

14,982

Iberia Airlines

OTP Schedule Flight

THE IMPACT BETWEEN AIRLINE OTP PERFORMANCE, OPERATION MANAGEMENT AND PASSENGER LOYALTY

Presented by:Reefear Eapear

Selected Airlines

• Air Asia Group: Established in 1994 and began operations on 18 November 1996• A low cost carrier (LCC) • Operates (Hub) in Malaysia, Indonesia, Thailand, India and Philippines • Operates scheduled domestic and international flights to 100 destinations spanning 22 countries.• Main Hub: KLIA2• Subsidiary:

a) AirAsia X

b) Indonesia AirAsia

c) Thai AirAsia

d) AirAsia Philippines

e) AirAsia Zest

f) AirAsia India

• Fleet: 183

AirAsia OTP performance (2012-2014)

Total number of AirAsia passengers (2012-2014)

Total revenue per year (2010-2014)

The Impact of On-Time Performance for Air Asia

1. On-time performances are not directly giving impact to the passenger loyalty and operational management

• The OTP are one of the minor causes for airlines to have better services.

• Air Asia was recorded 78.08% on-time performance on 2014 (2013 – 85.66%) but their passenger are rising from 42.61 million passengers on 2013 to 49.5 million passengers on 2014.

The Impact of On-Time Performance for Air Asia

2. Operational Operations - all delays will cost from 0.6 to 2.5% of their operating revenues.

• Improved on-time performance can help achieve significant cost savings to operational cost

• Set up special teams or organizational units• Research - there is a positive correlation between on time performance and

operating profit.

 

Percent of Total Delay Minutes  

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014Air Carrier Delay 26.3% 25.8% 28.0% 27.8%

28.5%

27.8%

28.0%

30.4%

30.1%

31.9%

29.4%

30.2%

Aircraft Arriving Late 30.9% 33.6% 34.2% 37.0%

37.7%

36.6%

36.2%

39.4%

40.8%

41.4%

42.1%

41.9%

Security Delay 0.3% 0.3% 0.2% 0.3% 0.2% 0.1% 0.1% 0.2% 0.1% 0.1% 0.1%0.1%

National Aviation System Delay 36.5% 33.5% 31.4% 29.4%

27.9%

30.2%

30.6%

25.7%

24.8%

22.5%

24.2%

23.5%

Extreme Weather 6.1% 6.9% 6.2% 5.6% 5.7% 5.4% 5.0% 4.4% 4.1% 4.0% 4.1%

4.3%

Summary

-In this case ,OTP doesn’t play an important roles in passengers preference of airline choices .

-Due to certain factors that lead this thing to be happen :NegotiationFaresStrategy Marketing strategy

Conclusion

Underlying factors of OTP to decline must be investigated and addressed to ensure the airline will not make more loses that is contributed by OTP. If matters are not being paid attention to it will cause a significance loss to the airline in term of revenue. Among the underlying factors of delays is aircraft delayed due late arrival from a previous flight, weather, airport congestion, air traffic clearance, engineering delay, passengers late show up limited buffer time between aircraft arrival and departure time. the following suggestion should be considered to improve the airlines (OTP).