Continuous approximation models for the fleet replacement and composition problem

Many goods distribution companies need to determine which vehicles to purchase and when. The resulting fleet is then routed to serve a set of geographically dispersed customers. In this paper we study the fleet replacement and composition problem while explicitly accounting for vehicle routing costs. In particular, we account for vehicle purchasing cost, maintenance cost, salvage revenue and routing costs. The latter is modelled via continuous approximation. We consider a finite planning horizon, throughout which we optimize the fleet replacement and composition. The resulting fleet is used to serve a subset of customers in a rectangular service region. We assumed that unserved customers are outsourced at a cost. We study the problem for homogeneous as well as heterogeneous fleets, present formulations for the special case of a single period, and extend them to construct formulations for multiple periods. We provide theoretical properties of our models and their solutions. Finally, we derive and present managerial insights based on a series of computational experiments.


  • English

Media Info

  • Pagination: 32p

Subject/Index Terms

Filing Info

  • Accession Number: 01593973
  • Record Type: Publication
  • Source Agency: ARRB
  • Report/Paper Numbers: CIRRELT-2015-64
  • Files: ATRI
  • Created Date: Mar 21 2016 11:47AM