Inventory optimization for a customer airline in a Performance Based Contract

This paper proposes an innovative model, i.e. the PBC-METRIC, which supports the customer airline manager to minimize the spare parts supply cost, in compliance with the airline availability requirements and with respect to the PBC. In detail, the PBC-METRIC models a multi-echelon, multi-item, single-indenture, multi-transportation network, by an innovative two-steps algorithm, defining the PBC specifications as modelling variables and parameters. A case study on a European airline, with the role of customer in a PBC, illustrates the outcome of the model.