The Impact of Airline and Customer Characteristics on Airline and Airport Choice

Abstract

The customer choice of a particular air flight is composed of two choice decisions in a multi airport region. The customer chooses the airline and the airport that best meets their needs. This dissertation is composed of two essays. The first essay examines the airline choice decision and the second essay investigates the airport choice decision. In the first essay the focus is the impact of airline operational quality among airline characteristics. This may include nonstop flight services, service frequency, on-time operations, etc. These factors contribute to the overall utility of airline service. Improvements in operational quality can lead to increases in reliability and convenience. As a result customers will choose airlines that offer higher levels of operational quality. Particularly, some customers are more sensitive to operational quality based on their unique characteristics and tend to have stronger preference for the airlines that provide higher levels of operational quality. This essay examines the following three issues; (1) the impact of operational quality on customer's choice of airline, (2) the moderating role of operations exposure (i.e., the extent to which customers are exposed to service operations) on customer choice, and (3) the moderating effect of customer characteristics on operational quality. The second essay looks at the impact of Low Cost Carrier (LCC) presence at airports and focuses on the following issues: (1) the impact of LCC presence on a route (after controlling for the impact of fares and service frequencies) on a customer's choice of airport, (2) the moderating effect of customer demographic characteristics on airline characteristics, and (3) the moderating role of the customer's geographical location on a customer's choice of airport. Both of these essays will utilize survey data collected from the customers departing from the three airports in the Washington Metropolitan Area. This data includes customers' choice of airline and airport along with extensive information on each customer including trip related information and demographic information.