Fleet Repositioning for Vehicle Sharing Systems: Asymptotic Optimality of the Balanced Myopic Policy

  • Yihang YANG
  • , Yimin YU
  • , Qian WANG
  • , Junming LIU

Research output: Journal PublicationsJournal Article (refereed)peer-review

Abstract

We investigate the fleet repositioning problem aimed at dynamically optimizing vehicle distributions to maximize long-run average social welfare in a vehicle-sharing system. We model the problem as a Markov decision process under the ex ante committed decision scheme, characterizing the balanced myopic policy as optimal for the average reward setting. This policy efficiently aligns vehicle supply with trip demand and mitigates the curse of dimensionality, enhancing computational efficiency significantly. Our analysis demonstrates that although the balanced myopic policy operates with less information, potentially leading to performance losses, the maximum performance gap relative to the ex post decision scheme asymptotically converges to zero as the system size increases. This finding underscores the asymptotic optimality of the balanced myopic policy, particularly in large systems, making it a robust and effective solution for fleet repositioning. Moreover, we extend our investigation to settings with seasonal demand, confirming that a generalized balanced myopic policy remains optimal. Through comprehensive numerical experiments and a counterfactual case study of a real-world vehicle-sharing system, we quantify the operational value of our approach. This study not only validates the balanced myopic policy against more information-intensive solutions but also illuminates effective heuristic design strategies for improving the efficiency of fleet repositioning in vehicle sharing systems.
Original languageEnglish
Article number10591478251349724
Pages (from-to)566-585
Number of pages20
JournalProduction and Operations Management
Volume35
Issue number2
Early online date2 Jun 2025
DOIs
Publication statusPublished - Feb 2026

Bibliographical note

Publisher Copyright:
© The Author(s) 2025

Funding

The authors received the following financial support for the research, authorship, and/or publication of this article: This research is partially supported by InnoHK initiative, The Government of the HKSAR, and the Laboratory for AI-Powered Financial Technologies. Yimin Yu received support from the Hong Kong General Research Fund [CityU 11505422] and City University of Hong Kong Strategic Research Grants [CityU 11507920]. Junming Liu received fund support from National Natural Science Foundation of China [Grant 72201222] and the Hong Kong Research Grants Council [CityU 11504322].

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

  1. SDG 9 - Industry, Innovation, and Infrastructure
    SDG 9 Industry, Innovation, and Infrastructure

Keywords

  • Balanced Myopic Policy
  • Fleet Repositioning
  • Markov Decision Process
  • Sharing Economy
  • Vehicle Sharing System

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