aircraft operating and delay cost per enplanement (aod cpe) · 2019-12-16 · background...

FINANCE COMMITTEE MEETING UPDATE

Aircraft Operating and Delay

Cost per Enplanement (AOD CPE)

April 7, 2014

Kristina Woodward and Remy Lucette

Ricondo & Associates, Inc.

2014 ACI-NA Airport

Concessions, Finance, Human

Capital and Legal Affairs

Conference

Max Underwood

V.P., Finance

Dallas/Fort Worth International Airport

Kristina Woodward & Remy Lucette

Ricondo & Associates, Inc.

STUDY OBJECTIVES

ALL-IN AIRPORT COST PER ENPLANEMENT | 2

Problem Statement

• Traditional cost per enplanement (CPE) is the industry accepted

method for comparing airline costs amongst airports

• However, traditional CPE is subject to various “pitfalls” when

used for comparison purposes

• Inconsistent airline rates & charges components (ACI-NA efforts

over past several years have improved consistency)

• Inconsistent in how airlines pay for use of facilities (i.e., non-rate

base items such as airline direct operating expenses and special

facility debt)

• Does not capture airline aircraft operating costs while certain airport

capital investments are intended to reduce such costs

• In summary, traditional CPE does not measure the “total airport-

related” cost to airlines of doing business at an airport


Components of Airline Costs at an Airport


• Terminal Rents

• FIS Fees

• Baggage System Fees

• Landing Fees

• Gate/Apron Fees

• RON Fees

Airline Rates & Charges

• Terminal Special Facility Debt

• Terminal O&M (Janitorial, Utilities, Etc.)

• Loading Bridges (Capital and O&M)

• Deicing costs

• Baggage Consortium Fees

Airport Costs Paid Directly by

Airlines

• Total Aircraft Taxi Time Costs (including taxi-in and taxi-out delays)

• Airborne Delays

• Gate Delays

Aircraft Operating & Delay Costs

#1

#2

#3

Study Objectives

1. Build on the traditional CPE to better capture the “total airport-related” cost to airlines of doing business at an airport.

2. Develop a metric that considers the return on airport capital investments.

3. Develop a metric that maintains a balance of not being overly complex; yet, is an effective measure that could be used industry-wide.

4. Develop a metric that would be acceptable for use by airport operators, airlines, and other industry stakeholders.

This alternative CPE measure is not intended to replace traditional CPE. It should be viewed only as an optional metric or tool to help calculate additional airline costs not captured through traditional CPE.


Background

• Approach of including cost of delay into traditional

CPE was initiated in 2009 to measure benefits of

airfield capital improvements at DFW.

• Approach was presented to ACI-NA Finance

Committee at Annual Conference in October 2011.

• SEA used approach to help present to airlines the

impacts of its recent airfield capital program.

• AOD CPE White Paper which provides background

and calculation methodology was developed.


Case Study: SEA


$27.04$25.52

$20.89

$18.00 $17.29

$14.39 $13.85 $13.65

$11.79 $11.77 $11.23 $11.20 $11.17 $10.71 $10.42 $10.23 $9.69

$7.52$6.43 $6.30

$5.20$3.58

$0

$5

$10

$15

$20

$25

$30

AP #22 AP #21 AP #20 AP #19 AP #18 AP #17 AP #16 AP #15 SEA (#14) AP #13 AP #12 AP #11 AP #10 AP #9 AP #8 AP #7 AP #6 AP #5 AP #4 AP #3 AP #2 AP #1

Cu

rre

nt

Trad

itio

nal

CP

E

Airport

Traditional CPE (Current) at Selected Airports

#14

$17

$26$27

$10

$14

$10

$14

$21$18

$10$12

$14

$6

$11

$4

$11 $12

$6

$11 $11

$5$8

$18

$14$13

$16

$15

$20$14

$9

$11

$14$13 $10

$16

$11

$16

$11 $10

$13

$9$9

$11$8

$13

$8 $6

$8

$8

$4$6

$3$3

$6 $5$4

$4 $5$5

$3 $2

$5 $2$2

$4 $3

$6$4

$3

$6$2

$4$3

$2$1

$2 $3

$2$4

$2 $3 $2$2 $1

$1$1

$2$1

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

$50

$55

$60

AP #18 AP #21 AP #22 AP #7 AP #17 AP #6 AP #15 AP #20 AP #19 AP #8 AP #10 AP #16 AP #4 AP #13 AP #1 AP #11 SEA (#14) AP #3 AP #12 AP #9 AP #2 AP #5

Cu

rre

nt

CP

E (T

rad

itio

nal

Plu

s A

ircr

aft

Op

era

tin

g C

ost

s)

Airport

CPE Incorporating Aircraft Operating Costs -- Selected AirportsUsing A4A (ATA) Aircraft Operating Cost Values

Airborne Delay

Taxi Delay

Taxi Time

Traditional CPE

#6

Example of Aircraft Operating Times

and Delays by Phase of Flight


Aircraft Departs

Unimpeded Taxi Out

Taxi Out Delay

Airborne

Time

Airborne Delay

Unimpeded Taxi In

Taxi In Delay

Gate Time

Aircraft Arrives

Taxi In Total Time Taxi Out Total Time Airborne Total Time Gate Time

Typical Breakdown of Flight Phases

Gate Out Delay

Operating and Delay Statistics: EXAMPLE SEA


Source: FAA ASPM Database, April 2014.

AVERAGE

MINUTES

TOTAL

OPERATIONS

(ARR OR DEP)

TOTAL

MINUTES

(000)

Average Airborne Delay 2.56 150,604 385.5

Average Taxi In Time 6.16 150,604 927.6

Average Taxi Out Time 14.05 151,109 2,123.1

Total 22.77 n/a 3,436.1

Calculating Total Aircraft Operating Time

Data Limitations

• Does not capture flight cancelations.

• Delay attribution is imperfect in some cases

(e.g., flow control delays related to

downstream airports).

• Does not measure delay propagation.


TOTAL

ANNUAL

DEPARTURE

COST

From Operating Minutes to Cost

Airborne Delay (Mins) Cost of one minute of

airborne delay ($)

Taxi In Unimpeded Time (Mins) Cost of one minute of

taxi time($)

Taxi In Delay (Mins) Cost of one minute of

taxi delay ($)


Taxi Out Unimpeded Time (Mins) Cost of one minute of

taxi time($)

Taxi Out Delay (Mins) Cost of one minute of

taxi delay ($)

TOTAL

ANNUAL

ARRIVAL

COST

Aircraft at-gate (or towed to hardstand)*

* The cost associated with at-gate aircraft was considered

but not included in the total cost as it is not directly under

the control of the airport.

AOD Cost by Phase of Flight Summary

• Summary of AOD Analysis Costs (CY 2012)


Sources: All Costs but Fuel, A4A, July 2013; Engine Fuel Flow, Aircraft Engine Database, July 2013; Aircraft Operations Share, DOT Form

41 T100; CY 2012 Fuel Cost per Gallon, BTS TranStats. January 2014.

TAXI COST PER

MINUTE SUMMARY

AIRBORNE COST PER

MINUTE SUMMARY

Fuel $11.58 $31.93

Crew $16.26 $16.26

Maintenance $12.02 $12.02

Aircraft Ownership $7.92 $7.92

Other $2.71 $2.71

Total $50.49 $70.84

Operating and Delay Cost per Enplanement


Total

Annual

Departure

Cost

Total

Annual

Arrival

Cost

+ =

Total Annual Aircraft

Operational and Delay

Cost (In $ Millions)

÷ Total Annual

Enplanements = OPERATING

AND DELAY

CPE

AOD CPE: EXAMPLE SEA


Source: FAA ASPM Database, April 2014. See prior table for cost source information.

AVERAGE

MINUTES

TOTAL

OPERATIONS

(ARR OR DEP)

TOTAL

MINUTES

(000)

COST

PER

MINUTE

TOTAL COST

(MILLIONS)

Average Airborne Delay 2.56 150,604 385.5 $68.91 $27.31

Average Taxi In Time 6.16 150,604 927.6 $49.80 $46.83

Average Taxi Out Time 14.05 151,109 2,123.1 $49.80 $107.20

Total 22.77 n/a 3,436.1 n/a $181.34

Divided by Total Enplanements (millions) 16.6

Total Aircraft Operating & Delay CPE $10.92

Potential Opportunities

for Further Refinement

• Airport-specific aircraft fleet mix

• Propagation of delay

• Coordinate with A4A to better understand their

methodology on aircraft operating cost data

• Coordinate with FAA/ATC on flow control delay

attribution


Proposed Next Steps


AUGUST 2013: Address Comments from Summit

JULY 2013: Presentation: ACI CFO Summit

JANUARY 2014: Submit White Paper to Committee for Review

SEPTEMBER 2013: Presentation: Committee Meetings

at Annual Conference

MARCH 2014: Committee White Paper Review Sessions

SECOND QUARTER 2014: Finalize White Paper

White Paper Review


Review & Comment

Max Underwood

[email protected]

+1 (972) 973-5460

Kristina Woodward

[email protected]

+1 (312) 606-0611 x 149

Remy Lucette

[email protected]

+1 (305) 260-2727 x254

aircraft operating and delay cost per enplanement (aod cpe) · 2019-12-16 · background...

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