Airline hub-and-spoke system design under stochastic demand and hub congestion

Abstract

This study addresses the hub network design problem considering demand uncertainty and hub congestion effects. The problem is formulated as a two-stage stochastic program with recourse model. The model provides a consistent set of hub locations, while adjusting network configuration in response to different demand realizations. A case study collected from real-world data was used to test the proposed model, and a sensitivity analysis was performed to know how several important parameters affected the solution.