Railway Demand Forecasting

Railway Demand Forecasting

Miloš Milenković, Nebojša Bojović
Copyright: © 2016 |Pages: 30
DOI: 10.4018/978-1-5225-0084-1.ch005
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Abstract

Forecasting represents an indispensable activity in railway transportation planning. Forecasting of demand levels is vital to the railway company as a whole as it provides the basic input for the planning and control of all functional areas including railway transport operations planning, marketing and finance. Demand levels and the timing of their appearance (on a day, week, month or seasonal basis) greatly effects capacity levels, financial needs and general structure of the business.Forecasting employs historical data and uses various forecasting methods to make accurate estimates of future demands. Forecasting approaches can be generally divided into two categories: econometric or causal and time series techniques. In this chapter a comprehensive review of methods belonging to these two broad classes will be made. Special emphasis will be given to the application of these techniques to railway demand modeling.
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2. Methods Of Forecasting

Considering railway demand forecasting, one classification of forecasting methods concerns the time in the future they cover. Long-term forecasts look ahead 5 to 10 years. Medium-term forecasts extend from 2 to 5 years into the future and short-term forecasts involve predictive intervals within 6 to 18 months.

Short and medium-term forecasts are required for activities that range from operations management to budgeting and selecting new research and development projects in railway transport. Long term forecasts impact issues such as strategic planning in the domain of railway infrastructure and mobile capacities.

The time horizon affects the choice of forecasting method because of the availability and relevance of historical data, time available to make the forecast, cost involved, seriousness of errors, effort considered worthwhile (Waters, 2008).

Despite the wide range of problem situations that arise in the field of railway transportation (railway operations management, marketing, finance and risk management) there are only two types of forecasting techniques – qualitative and quantitative methods.

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