28 Jan Airport 4.0: Cost and Benefit Analysis of the Smart StandReading Time: 3 minutes
Authors: Soufiane Daher of NACO and Christiaan Hen of Assaia.
Making innovations like smart stands successful requires a structured and analytical approach.
Firstly, it is absolutely critical that there is a clear vision and understanding of the problem that the solution should solve. This should be accompanied, if not preceded by, a business case laying out the viability of the solution from a business perspective before investigating the technological feasibility. Often, the focus is on questioning whether something can be done, while overlooking the more important question of whether it should be done.
To illustrate the business viability concept, we have set up the following fictitious example for analysis. Here, an airport is considering expansion of its aircraft stand capacity due to saturation. Assuming full recovery of its traffic by 2023/2024, the airport will need to deploy new stands to absorb traffic growth. This would be the more traditional approach.
In an alternative scenario, the airport would start converting its stands to smart stands during the coming three-year period. This would ensure the investment is spread out and that expansion is postponed by approximately three years. Such a cost/benefit comparison is based on an efficiency increase of 10% – i.e., that smart stands are able to absorb 10% more traffic than traditional stands. We further estimate that a 5% efficiency increase would already result in a break-even between the smart stands and the traditional approach. NB: for the sake of simplicity, we only took the cost for building stands into account. In reality additional terminals and taxiways would need to be built and/or higher operational costs incurred in the case of remote stands being deployed.
Given the short amount of time needed to convert a stand, it would be possible for the airport to ramp up its capacity in line with demand. With continued uncertainty around post Covid-19 traffic growth, smart stands provide a flexible option to ramp up capacity only when needed.
The actual efficiency increases which can be achieved as a result of using data and optimisation software will differ from case to case. However, several initiatives focusing on runway capacity have already shown that it is realistic to expect results in the 5-10% range.
Between 2010 and 2014 Gatwick used data analytics to create more predictable arrival and departure information which allowed them to increase declared runway capacity from 50 to 55 slots per hour while still seeing potential for another 5 slots . In line with this, Data Scientists from Eurocontrol presented similar findings as a result of their work with London Heathrow Airport .
Our own research, carried out for one of the largest and most congested airports in Europe, has resulted in even more notable outcomes. The use of Machine Learning technology to optimise stand planning resulted in planning the busiest period of the year (one week in the Summer season) with 7 stands fewer than usual. This represents an efficiency gain, or stand capacity increase, of 9%. Our optimised planning also reduced the required towing and bussing operations by 30% and 50% respectively thus lowering operational costs.
Considering the challenges that airports are facing, it is evident that a different approach is required. Smart technologies and digitisation are cost efficient solutions that address airports’ challenges and should be considered as viable alternatives for more traditional solutions like infrastructure expansion.
Contact us if you are interested to find out how smart stand technology can be used to increase stand utilisation rates at your airport.