The feeder fleet planning problem of the same-day ground express service in Taiwan

Time-definite freight delivery common carriers in Taiwan provide same-day ground express service for urgent customer shipments. Their line-haul operations consist of a single hub serving various centers in each express district with all of the hubs connected linearly. The fleet planning problem at the district level involves simultaneously determining the feeder fleet size and paths so that the total operating cost is minimized while meeting the service constraint. Under the triangle inequality principle, this is equivalent to a time and degree constrained minimum spanning tree with a fixed cost problem. We propose a branch and bound algorithm with two different bounding approaches using the largest carrier in Taiwan for numerical testing. The computational results show a smaller fleet size than the existing operation.