The 'fair share'-methodology in cargo: Using network planning effects to forecast the cargo carried per flight
This paper presents an econometric approach to model the dynamics in the air cargo market. Given a set of cargo demand forecasts, we apply them in market share forecasting using the 'fair share' of the airline. The 'fair share' hypothesis states that one can estimate an airline's market share based on an airline's fleet network design. We prove the hypothesis and show the freight market share to be largely affected by payload, the type of flight connection and the aircraft type. Our research enables us to distribute the expected cargo demand over cargo-carrying airlines per origin to destination-flow and estimate their market shares. In consequence, it allows us to analyze market scenarios when adjusting fleet schedules.