Edward Alonzo DeLisa Crowl MS3053 Business Case Study: Airline Refueling Plan for lig!t "our
E#EC$"%&E S$MMAR' Des(ri)tion of Airline ueling Analysis This report was commissioned to examine ways to determine the optimal amount of fuel to purchase for Coast-to-Coast Airlines on a four leg flight rotation tour and to recommend the optimal number of gallons to purchase at each leg flight location. The research draws attention to the fact that if the plane is carrying more than the minimum amount of fuel, the amount of fuel consumption is higher than at the minimum amount. The report evaluates the four legs in the tour and what would be ideal to meet the challenge presented to optimize the total number of gallons of fuel purchased in Atlanta, Los Angeles, ouston, and !ew "rleans. Business A(tions to Sol*e t!e Pro+le, Completed an #xcel $% &ormulation spreadsheet to determine the optimized number of gallons of fuel to be purchased in Atlanta, Los Angeles, ouston and !ew "rleans. The factors ta'en into consideration were the se(uence of the four legs in the tour, minimum and maximum fuel re(uired for ta'ing basic fuel consumption, fuel, price, and the extra five percent consumed when in excess of the threshold. Carrying the optimal amount of fuel is important because) it meets the &AA re(uirements* 'eeps the passengers safe* as well as provides some flexibility to redirect plane when needed. inal De(isions and Re(o,,endations To minimize the total cost of refueling for Coast-to-Coast Airlines on the four legs +Atlanta to Los Angeles +Los Angeles to ouston +ouston to !ew "rleans and +!ew
"rleans to Atlanta can be obtained by refueling , gallons in Atlanta* /0, gallons in Los Angeles* 1, gallons in ouston* and, , gallons in !ew "rleans. 2ased upon the price of fuel in each city, the total fuel purchase cost would be 3//0,45..
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ouston2-ew /rleans
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Los Angeles2ouston
C/-S"RA%-"S /+4e(ti*e fun(tion 6 minimize total cost of refueling.
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= gallons (in thousands) of fuel to purchase in Atlanta L = gallons (in thousands) of fuel to purchase in Los Angeles H = gallons (in thousands) of fuel to purchase in Houston N = gallons (in thousands) of fuel to purchase in New Orleans FA = fuel remaining when plane arrives at Atlanta from New Orleans FL = fuel remaining when plane arrives at Los Angeles from Atlanta FH = fuel remaining when plane arrives at Houston from Los Angeles FA = fuel remaining when plane arrives at New Orleans from Houston
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print out optimal solution
Coast-to-Coast Airlines is investigating the possibility of reducing the cost of fuel purchases by ta'ing advantage of lower fuel costs in certain cities.
Bince fuel
purchases represent a substantial portion of operating expenses for an airline, it is important that these costs be carefully monitored. owever, fuel adds weight to an airplane, and conse(uently, excess fuel raises the cost of getting from one city to another. $n evaluating one particular flight rotation, a plane located in Atlanta, flies from Atlanta to Los Angeles, from Los Angeles to ouston, from ouston to !ew "rleans, and from !ew "rleans to Atlanta. hen the plane arrives in Atlanta, the flight rotation is said to have been completed, and then it starts again. Thus, the fuel on board when the flight arrived in Atlanta must be ta'en into consideration when the flight begins. Along each leg of this route, there is a minimum and maximum amount of fuel that may be carried. Se9uen(e of t!e four legs in t!e flig!t tour
Atlanta to Los Angeles Los Angeles to ouston ouston to !ew "rleans !ew "rleans to Atlanta
Mini,u, fuel in gallons re9uired for ta;ing off<
Ma=i,u, fuel in gallons re9uired for ta;ing off<
Basi( fuel (onsu,)tion in gallons< for ea(! leg +ased on ,ini,u, (arried fuel
uel )ri(e )er gallon at ea(! de)arting origin in >
E=tra 5? fuel (onsu,ed w!en in e=(ess of t!res!old
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The regular fuel consumption is based on the plane carrying the minimum amount of fuel. $f more than the minimum amount of fuel is carried, the amount of fuel consumed is higher. Bpecifically, for each /, gallons of fuel above the minimum, 5D +or 5 gallons per /, gallons of extra fuel is lost due to excess fuel consumption.
&or example, if 05, gallons of fuel were on board when the plane ta'es off from Atlanta, the fuel consumed on this route would be /0 8 .5 7 /0.5 thousand gallons. $f 0 thousand gallons were on board, the fuel consumed would be increased by another .5 thousand, for a total of /0./ thousand gallons. C/-CL$S%/To complete the analysis and recommend where and how much to refuel on a four leg flight tour rotation, our team concluded that by purchasing the following gallons of fuel at each stop) , in Atlanta* /0, in Los Angeles* 1, in ouston* and, , in !ew "rleans, Coast-to-Coast Airlines will obtain the optimal amount of fuel to purchase for consumption and minimize the total cost of fuel to 3//0,45.. 2y refueling using the defined amounts obtained from our L% formulation, Coastto-Coast Airlines will remain within the minimum amounts of fuel re(uired for each leg. This will allow Coast-to-Coast Airlines to ta'e advantage of fuel pricing throughout the regions being served. The first leg of this four leg trip starting in Atlanta represents a total fuel cost of 3<4,. at a rate 34./5 per gallon. To optimize both fuel price and the number of gallons needed to complete trip, a total of /1, gallons of fuel will be purchased. The second leg of this flight tour originating from LA will re(uire that a total ;, gallons of fuel be purchased at a cost of 34.05 per gallon for a total of 3/0,<5. dollars. "nly a minimal fuel purchase will be made at this stop due to a slightly higher cost.
The third leg of this tour originating in ouston will re(uire that a /, gallon fuel purchase be made at a cost of 34./ per gallon charge resulting in a total purchase of 34,/. needed to complete this leg of this tour. The final leg of this tour originating out of !ew "rleans will re(uire that a 5, gallon fuel purchase be made to optimize fuel costs and minimize fuel consumption. This represents a total cost of 30,= at 34./1 per gallon of fuel.
