Research On Airlines Operational Performance Evaluation

With the sustainable development of national economy, air transport industry of China has been developing rapidly, and has become the second largest in the world in operational scale, which is only smaller than that of the United States. However, domestic airlines have been performing badly in the international market. They have been under deficit every year in almost all international routes especially in the European and U.S routes, except in some short-haul international routes. They own no more than 30% international cargo market share and only about 46% international passenger market share. Therefore, the operational performance and international competitiveness of domestic airlines must be improved, if the target for changing air transport industry of China from large one to powerful one would be reached.The operational performance of five domestic listed airlines (Air China, China Southern Airlines, China Eastern Airlines, Hainan Airlines and Shanghai Airlines) from 2006 to 2008 was evaluated through data envelopment analysis and binary relative evaluation methods in this paper which was based economics, operation research, statistics and so on. And then the relationship between airlines'operational performance and the percentage of state-owned assets, load factor and daily aircraft utilization was investigated.At first, the evaluating results of DEA showed that the operational performance of Air china in 2007 is the best, and China Eastern Airlines in 2008 is the worst. Generally, domestic airlines'operational performance is poor. Only 1/3 decision making units (DMU) operate efficiently. Poor operational performance is mainly caused by severely overcapacity and high operating costs.Secondly, the evaluating results of binary relative evaluation showed that Air China and China Eastern Airlines work hardest for improving their operational performance, however, the operational performance of China Eastern Airlines remain to be worst because of its bad operational state.At last, the results also showed that, except Air China, the lower percentage of state-owned assets is, the better operational performance is. When the airline's load factor is increased, the operational performance may not be improved, similarly, when daily aircraft utilization is increased, the operational performance may not be improved, however, when the product of load factor and daily aircraft utilization is increased, the operational performance will be improved definitely.