Capacited P-hub location problem allowing direct flow between spokes in intermodal transportation network

For the last twenty five years, hub location problems have become an important research area in the Location Theory. The use of hub and spoke network structure in modern transportation and telecommunication systems has a great effect on this. In hub and spoke systems flows from sources are collected in the hubs, which are generally located centrally and serve as collection and distribution points, and distributed to the destinations again via hubs to use advantages of the economies of scale. In this study, real-life problem of a Turkish public institution is addressed. Different from the studies in the literature, we consider an intermodal transportation network where spoke-to-hub and hub-to-spoke transportation could be either land or air movement while hub-to-hub transportation is only air movement. The proposed study differs in some respects from studies in the literature. Firstly, obligation to use of hubs for the flows between origin and destination pairs is relaxed. Secondly, due to the special nature of the problem being addressed not all the nodes are considered to be candidates as hubs, instead some specific nodes are taken into consideration. Lastly, hubs’ capacities are made to be affected by the flow not only from hubs but also spokes. The results showed that the proposed model produced a lower total cost compared to the studies in the literature and the current applied method.