FLYR Labs is bringing artificial intelligence and machine learning into airline route planning and pricing, and it’s getting a lot of attention!
A previously cancelled but now-reinstated trade show will boost demand for routes to a city. Worsening finances in one country could impact routes to far-flung vacation destinations. Cancellations in trains and other services can cause last-minute spikes in demand for air travel. And of course, vacation breaks happen at different times, in different places.
Airline route planning, along with the study of demand forecasting, is a science. Literally. There are colleges and universities with courses in Air Transport Management or Airline Route Management. Both Airlines and airports need constant studies on new routes and market opportunities, and the people to do them. And companies like FLYR Labs could be about to add another dimension to the field.
We have seen that route planning and pricing can define and/or change how an airline uses its fleet. Or, it can lead an airline to change its fleet completely. We saw how Air France in the 1990s bought and used the entire A320 aircraft family (A318/19/20/21). Having multiple aircraft sizes that pilots could fly interchangeably, allowed them last-minute aircraft changes, to suit unpredictable short/medium-haul demand.
Staying Ahead of Demand (and Supply)
Many airlines used similar models. But more recently, low-cost carriers flying the same routes, rely on just one or two aircraft variants. Well before anyone like FLYR Labs, airlines were using route planning and forecasting, along with aggressive pricing. The goal was to keep all aircraft seats full, for the best possible price – for the airline. This decades-old job has been getting more and more effective. And in doing so, it has progressively allowed airlines to simplify their fleets.
This past week, San Francisco-based FLYR Labs secured $150 million in Series C funding. Leading this was growth equity firm WestCap, with many other investors taking part. Among them is Silver Lake Waterman and JetBlue Technology Ventures. The company includes people with experience working at American Airlines, Southwest Airlines, GE, IBM and others.
FLYR Labs isn’t just using clever computers to schedule flights and set prices. That part of the work is not new. IBM introduced successive generations of supercomputers over the decades, for this reason. That’s because airlines announce their flights many months in advance. And that means having to plan, price, monitor and re-price tens of thousands of airline seats.
Consider how many scheduled flights this means, for each day in these months. And now consider that the airline would reconsider the price of a flight’s remaining seats, after each ticket sale. Or after each day, as the date of the flight draws nearer. And now apply this to a fleet of, say, 400+ aircraft, with different capacities and economics. Oh and don’t forget fuel price variations.
The Role of FLYR Labs
But even so, the process relied on a lot of manual research. This is where FLYR Labs comes in, to evaluate all those factors we mentioned in the beginning. Changes in trade shows, vacation patterns, train and ferry cancellations or financial trends for holidaymakers. Keeping tabs on all such factors, and applying them on thousands of flights, is a gargantuan task.
FLYR Labs is working on Cirrus, an AI-based software platform that aims to revolutionize this process. We’ve previously mentioned that as tough as predicting demand is normally, the pandemic has thrown all year-on-year forecasting out of the window. So FLYR could be close to proving its worth.
The company has predicted that available flights from the northeastern US to Florida and Latin America won’t meet demand over the coming holiday season. They’ve gone to more detail for specific date ranges, as well as the time of day. FLYR Labs claim to have “over half a dozen” airline customers, including Air New Zealand. They aim to get to double-digits, before the end of the year.
It will be interesting to see how this company will develop over the next few months. After aviation, FLYR aims to provide its services to ferry, freight, car rental and train operators, among others.