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Faculty of Science, Engineering and ComputingAssessment BriefModule: AE6601A – Air Transport EconomicsSetter:Dr Anil PadhraTitle of Assignment:Airline Ticket Price AnalysisDeadline:Friday 10th February 2017Module weighting: 25%Submission details: You must submit the assignment electronically through Turnitin onStudyspace and the file will be subsequently reviewed through plagiarism detectionsoftware. In accordance with Section 5 of the Undergraduate Academic Regulationsdocument you are permitted to submit the assessment after the deadline though you will bepenalised. If the assessment is submitted after the deadline and within five working daysafter the deadline your mark will be capped at 40%. If the assessment is submitted after fiveworking days after the deadline it will be counted as an attempt and awarded a mark of 0%.Module Learning Outcomes assessed in this piece of courseworki)Assess the potential impact of an Airline’s business strategy. ii)Discuss the major determinants of air transport supply, demand and cost.Assignment Brief and assessment criteria A key element of a profitable global aviation industry is the ability of airlines to generate asufficient amount of revenue from passengers. Airlines rely on a team of revenuemanagement analysts to ensure that every seat sold is done so at the maximum pricepossible. When revenue management get it wrong, the airline will either not fill enoughseats due to high prices or fill too many seats at low prices. Both scenarios will result in lostrevenue and lower profits. For this reason airlines incorporate price discrimination wherebysimilar seats are sold at different prices depending of passenger demand and time ofbooking. The general perception amongst passengers is that the earlier you buy the ticketthe cheaper it is but this may not always be the case.This assessment is conducted in two stages. The purpose of the first stage of this assignmentis to collect data of airline ticket prices on a daily basis to understand the trend in ticketprice fluctuations and over what time period.Take time to plan the data you collect. Poor planning will result in poor data making itdifficult for you to achieve a good mark.Choose four one-way routes (Two Leisure and Two Business).Choose direct flights only.Choose a departure date in early December.
Monitor prices in economy class for at least three airlines per route.Monitor prices everyday for at least six weeks before the departure date.Identify the aircraft type operating the route to estimate the seat capacity.To be able to compare, you should try to collect data as fairly and consistently as possible by:Choosing flights departing and arriving at the same airport.Choosing similar departure and arrival times.Monitoring prices at the same time everyday.Only use the airlines official website to obtain prices (Avoid flight comparison websites such as Skyscanner, Expedia, Ebookers, Momondo, Hipmunk etc.Delete internet cookies before requesting prices.Be careful not to choose two airlines operating a codeshare.Typical leisure routes are: Spanish and Greek islands, North African coast, Las Vegas, Florida, Caribbean islands, Indian Ocean, Thailand.Typical business routes are: Major European capital cities, German cities, New York, Hong Kong, Tokyo, Singapore, Seoul, Toronto, Seattle, Beijing, Shanghai.Tip! Feel free to use flight comparison websites to identify routes and the airlines serving those routes. Then use the airlines official website to track prices.Once you have completed your data collection, the next stage is to statistically analyse thedata you have collected, present it in a graphical format and discuss what the data suggestsabout the airlines pricing strategy. You should (i)Explain briefly which routes, airlines and flights you chose to collect data forand the reasons for doing so. Identify any situation where the data collectedwas outside the norm such as sold out flights etc.(ii)Present the data using clear and appropriate graphical methods. Pricefluctuations with time should be clear.(iii)Apply data analysis to identify any trends and correlations in the fluctuations.You can use any mathematical method that will identify patterns. It isimportant that any analytical method and calculation used is clearlydescribed.(iv)Compare and discuss the ticket price trends between different routes andairlines and suggest possible reasons for the trends. Can you identify the besttime to buy a ticket? Is it possible to forecast the fluctuations for similarflights? (v)As an additional activity you should collect ticket price data for a single route,served by an airline for multiple ticket numbers increased incrementally. Youshould then record the ticket price per ticket and comment on the resultsobserved. Some good airlines to use for this task are EasyJet, Ryanair,Monarch and Scoot.
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