Global Air Navigation Service Performance Report 2017 Executive Summary

civil air navigation services organisation

Global Air Navigation Services Performance Report 2017 2012 - 2016 ANSP Performance Results

Executive Summary

Global Air Navigation Services Performance Report 2017 | The ANSP View

The CANSO Global Air Navigation Services Performance Report 2017 is a collective and entirely voluntary benchmarking effort of CANSO Member air navigation service providers (ANSPs) which covers data from the 2016 fiscal years of ANSPs and trend data between the 2012 and 2016 fiscal years.

Editorial Team Paul Cripwell, NAV CANADA, current Chair of the Global Benchmarking Workgroup (GBWG) Siree Vatanavigkit, Aeronautical Radio of Thailand (AEROTHAI), incoming Chair of the GBWG Helios - CANSO Performance Benchmarking Project Team Contributors Nigel Fitzhardinge, Airways New Zealand Kunthinee Karunratanakul, AEROTHAI Krishnan Udayabhanu Rao, Airports Authority of India (AAI) Kanhaya Lal, AAI Carol Teo, Civil Aviation Authority of Singapore (CAAS) Edmund Heng, CAAS Christopher Gregg, Federal Aviation Administration - Air Traffic Organization (FAA-ATO) Dina Dolan, FAA-ATO Aleksandra Damsz, FAA-ATO Kristin Stadum, FAA-ATO Diana Galgoczi, HungaroControl Livia Cseh, HungaroControl Sigurleifur Kristjansson, ISAVIA Aslaug Adalsteinsdottir, ISAVIA Yoshiaki Dei, Japan Air Navigation Service (JANS) Liva Krigere, Latvijas Gaisa Satiksme (LGS) Bill Clark, NAV CANADA Ana Pinto, NAV Portugal Jolanta Wakulicz, Polish Air Navigation Services Agency (PANSA) Mindaugas Gustys, Oro Navigacija Tomas TamaĹĄauskas, Oro Navigacija Audrius RadzeviÄ?ius, Oro Navigacija Bader Alaydi, Saudi Air Navigation Services (SANS) Ted Fudge, Civil Air Navigation Services Organisation (CANSO) Disclaimer This report has been compiled using data provided by participating ANSPs. To facilitate comparability, data for each ANSP has been transformed to be consistent with standard definitions. The resulting data and comparisons have been produced solely for the use of ANSPs, and other interested parties, to assess and appraise performance in air navigation services (ANS) provision. It is not intended that the data from this report is used for any wider purpose, nor does the data provide a definitive assessment of any metric relating to ANSP processes.

December 2017

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Global Air Navigation Services Performance Report 2017 | The ANSP View

Foreword The CANSO Global Air Navigation Services Performance Report provides an annual global picture of air traffic management (ATM) performance and trends over a five-year period. 2017 marks the eighth time CANSO has produced this report, and the fourth year of collaboration with Helios.

With more Members joining the CANSO benchmarking activities every year, we are continuously expanding and developing the scope of our research and the value that it brings to the ATM community and the broader aviation value chain. Each participant brings a unique perspective of the industry in its region and has the opportunity to share experiences, discuss common issues and learn from its peers. Our goal is to keep developing the valuable and relevant reports and promoting the benefits of participation industry-wide.

The aim is to provide a framework for CANSO air navigation service provider (ANSP) Members to measure their performance and compare this with their peers. This information informs and facilitates discussions between ANSPs on the topics and trends related to performance and on improving ATM efficiency in the future.

I would like to thank all the participating CANSO Members, along with the CANSO Global Benchmarking Workgroup (GBWG), particularly the outgoing chair Paul Cripwell, and Helios, for their hard work in making this report possible. Our fundamental objective is that together the ATM community works to perform better each year and celebrates success.

The CANSO Global Air Navigation Services Perfor mance Report 2017 (which covers performance data from 2012-2016), shows that in 2016 the cost efficiency and productivity of air navigation service (ANS) provision improved. Over half of the participants saw their service cost (cost of managing each IFR flight hour) decrease or remain steady, while 77 percent saw air traffic controller (ATCO) productivity increase.

These findings show that CANSO Member ANSPs are adapting well to significant increases in both passenger numbers and airline capacity.

Jeff Poole Director General CANSO

Overall, the information in the report is important in understanding the current levels of performance of the ATM industry and its ability to deliver efficient and effective ANS both now and in the future.

Indeed, the results are a clear indicator that CANSO ANSP Members are successfully working to transform global ATM performance effectively and efficiently. CANSO and its Members have a series of benchmarks for continuing to improve ATM performance globally.

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Global Air Navigation Services Performance Report 2017 | The ANSP View

THE EXECUTIVE SUMMARY Foreword................................................................................................................................... page 3 Introduction.............................................................................................................................. page 5 Measuring Cost Efficiency and Productivity.............................................................................. page 7 2016 Participation..................................................................................................................... page 9 Global Context: High Demand, High Flow................................................................................. page 11 Key Findings.............................................................................................................................. page 14 Summary................................................................................................................................... page 19 Acronyms and Abbreviations.................................................................................................... page 20 Sources..................................................................................................................................... page 21

FIGURES Figure 1: CANSO Air Navigation Services Performance Framework........................................ page 7 Figure 2: RPK, ASK Growth Comparison................................................................................... page 11 Figure 3: Movements, Passenger Growth Comparison.................................................................. page 12 Figure 4: Five-year Movements, Passenger Growth Comparison............................................. page 13 Figure 5: Cost (USD) per IFR flight hour.................................................................................... page 14 Figure 6: ATCOs in OPS Employment cost per ATCOs in OPS hour........................................ page 15 Figure 7: ATCOs in OPS hour productivity............................................................................... page 16 Figure 8: Cost per IFR flight hour/IFR flight hours per ATCO in OPS hours............................. page 17 Figure 9: IFR flight hours per ATCO in OPS hours/ ATCOs in OPS Employment cost per

ATCO hour................................................................................................................. page 18

TABLES Table 1: KPIs Summary............................................................................................................... page 8 Table 2: Participating ANSPs.................................................................................................... page 9 Table 3: ANSP Fiscal Years for 2016 and Legal Status.............................................................. page 10 Table 4: Legal Status Definition................................................................................................ page 10

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Global Air Navigation Services Performance Report 2017 | The ANSP View

Introduction Key considerations

ANSPs control flights within each country’s sovereign and delegated airspace, each performing an extensive range of functions to effectively carry out this responsibility. The specific nature of these functions varies slightly from ANSP to ANSP, but involves participating in infrastructure and technology projects to improve airspace capacity, training and employing air traffic controllers (ATCOs) who are responsible for managing the airspace, and ensuring that the charging process is carried out in a clear, efficient and transparent manner.

There are several key points to consider when benchmarking ANSP performance. At an industry level, there are a number of unique challenges and constraints within which an ANSP must operate to deliver effective and safe ANS provision. These • •

The governance structures of ANSPs are not consistent globally – a fact which partly explains the range of functionalities. Some are part of a government agency, others a part of a costrecovery government function, a special operating agency within a government structure, a publicprivate partnership, or a private company. In all cases, the overarching goal of each ANSP is the same: to manage its airspace safely and efficiently.

To that end, CANSO has devised benchmarking exercises that aggregate and review performance accordingly.

• • •

En-route flights require air traffic control (ATC) on a 24/365 basis (regional towers require less continuous oversight) A minimum level of control must be provided regardless of the level of air traffic activity, even if there is none ATCOs require long training periods to become certified and frequent refreshment training periods A major portion of each ANSP’s annual total cost is the employment cost related to ATCOs, and this cost is fixed relative to flight activity Significant fluctuations in air traffic do not drive short term changes in the ATCO roster.

Such changes must be absorbed by the ANSP while it continues to plan in the longer term.

These conditions can make it challenging to deliver a cost-effective service. In addition, each individual ANSP has a second set of challenges that are a function of local and regional government regulation, culture and other customs. These are unique to each ANSP and thus direct comparisons of cost-effectiveness prove more challenging.

Improving efficiency ATM is a critical part of the aviation industry, ensuring safe air travel for billions of passengers and millions of tonnes of freight each year.

Today’s global economy heavily relies on aviation, and globalisation continues to drive significant increases in air travel in terms of aircraft movements, passenger numbers and volumes of cargo. Conducting this worldwide traffic flow, in a safe and efficient manner, is the key function of every ANSP and a vital cog in the global economy.

Therefore, maximising the cost-efficiency of this activity is crucial.

The conditions under which an ANSP operate can be summarised by the following:

Every ANSP aims to improve its costeffectiveness, which impacts stakeholders across the aviation value chain, including airspace users.

There is no end goal in terms of cost-efficiency, as incremental improvements will always be possible.

•

High proportion of fixed costs

•

Small proportion of variable costs that are controllable

•

Requirements to provide service at all times, regardless of the level of demand

•

No control over demand for services

Benchmarking The goal of benchmarking – both within this report, and as a practice in general – is to compare the business processes of one organisation to another. CANSO uses performance metrics to provide accurate comparisons between ANSPs and build a comprehensive overview of industry trends.

Each ANSP that participates in the report recognises that other ANSPs have implemented programmes to improve cost-effectiveness that may be applicable to their own operation, and that everyone benefits from discussion of these programmes and the results obtained. Because of this, many ANSPs have decided that working

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This report does not seek to compare the results of various ANSPs to a ‘best-in-class’, rather it identifies performance trends within the industry, as well as acting as a basis for ANSP improvement by identifying areas of concern for discussion among ANSPs. One challenge we have faced when developing this report is the interrelationship between different areas of ANSP performance. For example, each ANSP must try to balance safety with costefficiency and capacity provision. While this report focuses on cost-efficiency, CANSO also undertakes benchmarking in other areas, including safety. Quantifying the effect that other areas of performance have on cost-efficiency is a continuing task.

Purpose of this report CANSO provides a forum for Members to meet and exchange ideas on a range of issues, including cost-effectiveness, and develop key performance indicators (KPIs). KPIs allow ANSPs to measure performance, investigate whether the trend is positive or negative, and thus identify which areas to target for improvement.

The CANSO Global ANS Performance Report therefore collates information relating to the costefficiency and productivity of a variety of ANSPs, highlights global trends and identifies performance gaps.

This collaboration serves a dual purpose. First, it demonstrates to stakeholders that airspace is being used with appropriate consideration for capacity, operational efficiency and cost-effectiveness, while continuing to prioritise safety. Second, it demonstrates to the wider aviation industry that, through CANSO, ANSPs are working together to improve both their own performance and the performance of ATM globally.

Members that participate in this benchmarking effort receive the raw data from the other participants, and are involved in the continued development and refinement of the KPIs. It is this continuing activity that aids each ANSP in determining where improvements can be made, and through the network of participants that the exchanging of ideas is facilitated.

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Measuring Cost Efficiency and Productivity The following cost efficiency and productivity indicators are used to determine the performance of ANS. These KPIs are all part of the CANSO ANS Performance Framework (detailed in the ANSP View).

Figure 1: CANSO ANS performance framework

It is important to note the dependence of the higher tier metrics on the lower tier ones. This can be established as follows:

1=

2A + 2C 2B

2A= 3A 3B 2B= 3C 3B

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Global Air Navigation Services Performance Report 2017 | The ANSP View

KPI 1

Reason for tracking this KPI Cost per IFR flight hour

To give an overview of the cost-efficiency of an ANSP

2A

ATCO in OPS costs: ATCOs in OPS employment To look at the employment costs of each ANSP – a key driver in cost-efficiency

2B

ATCO in OPS costs: ATCOs in OPS hour This couples with 2A to show the drivers behind changes productivity in ATCO cost-efficiency

2C

Costs excluding ATCOs employment costs per To try to obtain a more complete picture of ANSP costs IFR flight hour – 2C may be broken down into more level 3 indicators in future reports

3A

Annual employment cost per ATCO in OPS

This couples with 3B to show the drivers of changes in 2A

3B

Annual working hours per ATCO in OPS

This couples with 3A to show the drivers of changes in 2A, and with 3C to show the drivers of changes in 2B

3C

Annual IFR hours per ATCO in OPS

This couples with 3B to show the drivers of changes in 2B

Table 1: KPIs Summary

Cost efficiency

Productivity

Cost efficiency provides an indication of the balance between operational effectiveness (ATCO productivity) and the cost of providing the service.

For example, an operationally effective ANSP with relatively high costs can be as cost effective as a less operationally effective ANSP with lower costs.

The key indicator of ANS productivity is IFR flight hours per ATCO in OPS hour, often described as ‘ATCO productivity’, and which provides useful insights into an ANSP’s performance. However, there are also occasions when factors beyond the control of the ANSP can cause low levels of productivity – for example a geopolitical event that alters traffic.

The simplest indicator of cost efficiency is the cost of providing ANS services per IFR flight hour.

However, there are many factors that also influence this indicator and a lower cost per flight hour is not necessarily indicative of improved overall performance.

ATCO productivity is driven by traffic levels and an ANSP’s ability to utilise its ATCOs in operations (OPS) resources. Clearly, the former cannot be influenced by the ANSP; however, there are numerous examples of ways that an ANSP can improve its resource utilisation. These include flexible rostering and the adaptation of airspace configuration to open and close sectors according to evolving traffic patterns. Furthermore, advances in technology are now focusing more than ever on reducing the workload of the ATCOs in OPS to enable them to control more aircraft in a given period and volume of airspace.

Much of the observed cost difference is due to economic differences, which the ANSP may not be able to control. This includes labour contracts, salary scales and working conditions (such as hours), as well as government regulations on pension management and mandatory financial controls.

ANSPs also have virtually no control over the volume of traffic, which is a function of economic activity and other air passenger demands.

A further factor in ATCO productivity is the complexity of the airspace. Lower airspace, with lots of climbing, descending and crossing traffic will typically have lower levels of ATCO productivity than upper airspace where aircraft are flying at more consistent altitudes and on non-crossing routes.

Therefore, an ANSP operating a high proportion of sectors in lower airspace, or with numerous busy airports with complex approach sectors, is likely to have lower ATCO productivity than an ANSP focussing more on overflights at higher altitude.

Importantly the comparison of cost indicators should be considered in the context of external factors and other performance areas. The absolute cost indicator also does not account for the quality of service provided by the ANSP. There are costs associated with providing a safer and more punctual service, but this report provides only part of the overall picture of ANS. Costs are broken down to consider the employment cost of ATCOs in OPS per hour and all other costs. The majority of staff cost is the cost of ATCOs in OPS, as safety-critical and highly-skilled staff members.

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2016 Participation Data submissions were received from 33¹ ANSPs, which included 3 new participants.

The 2016 data submission covers² : Total IFR flight hours: 45,307,459 Total costs: USD 231,058,460,603

Region Africa

Americas

Asia Pacific

Europe

Middle East

Total ATCOs in operations: 26,099

Member Air Traffic & Navigation Services Civil Aviation Authority of Uganda Kenya Civil Aviation Authority KCAA

Label for Graphics ATNS CAAU KCAA

Corporacion Centroamericana de Servicios de Navegacion Area Federal Aviation Administration – Air Traffic Organization NAV CANADA Servicios para la Navegación del Espacio Aereo Mexicano

COCESNA FAA-ATO NAV CANADA SENEAM AEROTHAI AAI Airservices Airways NZ CAAS JANS PNGASL

Aeronautical Radio of Thailand Airports Authority of India Airservices Australia Airways New Zealand Civil Aviation Authority of Singapore Japan Air Navigation Service Papua New Guinea Air Service Ltd Administration de la Navigation Aérienne Air Navigation Services of the Czech Republic Devlet Hava Meydanları İşletmesi Genel Müdürlüğü Estonian Air Navigation Services Finavia HungaroControl Pte. Ltd. Co. Isavia Ltd Luftfartsverket Latvijas gaisa satiksme Letové prevádzkové služby Navegação Aérea de Portugal - NAV Portugal, E.P.E. SE Oro Navigacija Polish Air Navigation Services Agency Romanian Air Traffic Services Administration Sakaeronavigatsia Ltd Slovenia Control Serbia and Montenegro Air Traffic Services SMATSA IIc Saudi Air Navigation Services

ANA ANS CR DHMI EANS Finavia HungaroControl Isavia LFV LGS LPS NAV Portugal Oro Navigacija PANSA ROMATSA Sakaeronavigatsia Slovenia Control SMATSA SANS

Table 2: Participating ANSPs

¹One ANSP has requested to remain anonymous and is thus not included in the table above. ²As some ANSPs did not submit data for every field, this is not the total for all participating ANSPs; rather it is the total of all data submitted.

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Region

Member

Africa

Americas

Asia Pacific

Europe

Middle East

Fiscal Year Dates

Legal Status

ATNS CAAU KCAA

Apr 2016 – Mar 2017 Jan 2016 – Dec 2016

C B

COCESNA FAA-ATO NAV CANADA SENEAM

Jan 2016 – Dec 2016 Oct 2015 – Sep 2016 Sep 2015 – Aug 2016 Jan 2016 – Dec 2016

A E A

AEROTHAI AAI Airservices Airways NZ CAAS JANS PNGASL

Oct 2015 - Sep 2016

D B

Jul 2016 – Jun 2017 Apr 2016 – Mar 2017 Apr 2016 – Mar 2017

C B A B

ANA ANS CR DHMI EANS Finavia HungaroControl Isavia LFV LGS LPS NAV Portugal PANSA Oro navigacija ROMATSA Sakaeronavigatsia Slovenia Control SMATSA

Jan 2016 – Dec 2016 Jan 2016 – Dec 2016

A C B

Jan 2016 – Dec 2016 Jan 2016 – Dec 2016 Jan 2016 – Dec 2016

C C C

Jan 2016 – Dec 2016

C B D B C B C C Other 4

SANS

Jan 2016 – Dec 2016

C

Jan 2016 – Dec 2016 Jan 2016 – Dec 2016 Jan 2016 – Dec 2016 Jan 2016 – Dec 2016 Jan 2016 – Dec 2016

Table 3: ANSP Fiscal Years for 2016 and Legal Status

Identifier

Legal Status

A

A government department or authority that is subject to government accounting and treasury rules and staff are employed under civil service pay and conditions.

4

B

A government entity empowered to manage and use the revenues it generates through charges for the services it provides.

8

C

A corporatised entity with special status, not governed by normal commercial law, but by a specific founding law or statute (and wholly owned by the government).

11

D

A company established as a public-private partnership to provide the services on behalf of the government, and part-owned by the government.

2

E

A private sector company owned and/or operated by private interests to provide the service on behalf of the government, either by statute or contract.

1

Table 4: Legal Status Definition

3 4

Count

Airways NZ submitted two years’ worth of data, which is explained in more detail in the ANSP View.

Limited liability company, 100 percent state-owned (92 percent owned by Serbia and 8 percent owned by Montenegro).

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Global Context: High demand, High flow

Rising passenger load

Low fuel costs

In 2016, passenger numbers continued to grow, contributing to another strong financial year for airlines. It appears the industry is confident that growth will continue, since for the first time since 2011, available seat kilometres (ASK) grew at a faster rate than revenue passenger kilometres (RPK), as reported by the International Air Transport Association (IATA). This indicates investment in extra passenger capacity has finally caught up with the rate that passenger load is increasing – a critical factor for ATM operations worldwide because aircraft movements increase.

In 2016, the average price of a barrel of jet fuel continued to drop. This resulted in a decrease in total expenditure on fuel of $42 billion from $175 to $133 billion, and, more importantly, a decrease in the proportion of expenditure spent on fuel – which fell from 26.5 percent to 20.6 percent.

This contributed to global airlines posting one of their strongest financial performances to date in 2016. The $34.8 billion net after-tax profit and corresponding operating margin of 8.8 percent of revenue means global airlines will continue to increase operations and requirements for ANS.

There were, once again, significant regional disparities this year, which are highlighted below.

The results that are most notable are the huge increases in both RPK and ASK in Africa. While the 9.4 percent increase in RPK is likely to be the headline figure, it is the 8.2 percent increase in ASK that will pose a challenge to the ANSPs operating in the region. Elsewhere, there was another year of strong growth in both the Middle East and Asia Pacific regions, with more modest growth in the other regions.

Figure 2: Revenue Passenger Kilometres, Available Seat Kilometres Growth Comparison (2015-2016)

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Figure 3: Movements, Passenger Growth Comparison

Increasing aircraft movements In line with airline growth, Airports Council International (ACI), which recorded information from over 2,400 commercial airports across 175 countries, saw worldwide aircraft movements at these airports increase 2.7 percent in 2016 to 91.8 million. This was the second consecutive year where growth has been above 2 percent.

This was primarily driven, once again, by large increases in movements in Asia Pacific and the Middle East, which is on the verge of overtaking Africa in terms of movements. Africa’s aircraft movements continued reducing at the same rate as last year, whereas movements reduced again at a significantly higher rate in Latin America and the Caribbean. Meanwhile, movements in Europe and North America continued increasing, at a higher rate than last year.

and North America saw more modest increases in passengers. However, unlike last year, Africa saw a decrease in the number of passengers – driven by a 1.7 percent reduction in international passengers – and the rate of increase in Latin America and Caribbean was less than a quarter of what it was a year ago.

The trend in passenger movements over the last five years gives an idea of the challenges of growth that ANSPs have been facing in all regions. The Middle East and Asia Pacific have been continuing to grow for some time, and every other region has seen some growth over the last five years – a trend which is expected to continue. This means the picture of ANS provision worldwide will also differ from region to region, growing at a faster rate in some areas than in others.

2016 also saw very significant increases in passenger movements for the Middle East and Asia Pacific, which drove a global rise in passengers of 6.5 percent. This can be attributed to increasing aircraft size coupled with the load factor remaining constant. As with aircraft movements, both Europe

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Figure 4: Five-year Movements, Passenger Growth Comparison

Onwards and upwards While record passenger numbers, low fuel costs and the resulting airline confidence have an impact on the overall picture of aviation, it is growth in movements that will affect ANSPs most significantly in the immediate term. In the longer term, it is likely that new technologies and new entrants to airspace will also contribute to the growth in requirements for ANS globally, and this will become more apparent in the years to come.

How ANSPs manage the flow of airspace users and potential capacity issues, and indeed how demand for investment in infrastructure is met, is directly linked to the cost-efficiency and productivity of the industry. These indicators demonstrate how effectively ANSPs are meeting demand, and how the industry is adapting to the ever-increasing pace of operations globally.

As part of its benchmarking activities therefore, CANSO actively monitors these worldwide developments and trends to ensure it accounts for such shifts in operating conditions, and that ultimately ANSPs not only remain efficient and effective, but are also prepared to meet demand and grow onwards and upwards.

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Key Findings

Increases in the volume of traffic have led to decreases in the costs per flight hour The top-level metric for determining costefficiency is cost per IFR flight hour. This is the cost of safely managing controlled IFR flight hours in continental and oceanic airspace. It is presented on a per IFR hour basis, in order to improve the comparability of the data between ANSPs.

The data shows that around 55 per cent of ANSPs have seen either a decrease or no change in their cost per IFR flight hour, while 45 percent have seen an increase. This contrasts with last year, where the majority (57 percent) of ANSPs saw an increase in their cost per IFR flight hour.

Based on global factors, including increases in volume of movements, it can be deduced that ANSPs have been more cost-efficient, while safely managing the increasing flow of air traffic.

Figure 5: Cost (USD) per IFR flight hour

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Employment costs continue to increase for the majority of ANSPs but the pace slows The ‘ATCOs in OPS employment cost per ATCO hour’ metric considers employment costs per service delivery. As comparing salaries in different States and regions is not necessarily particularly informative, it is often more useful to track the trend data of this metric, as opposed to the raw figures.

While we saw decreases in the top-level metric (cost per IFR flight hour) for the majority of members, employment costs increased for 67 percent of participants. This does however represent a decrease on last year, where 89 percent of participants saw this metric increase. In addition, whereas 64 percent of the ANSPs saw an increase in this metric of over 5 percent in 2015, this year it is only 48 percent that saw such a drastic change. In summary, while employment costs continue to rise – as they have done for several years – the increase does appear to be slowing somewhat.

While a rise in employment costs would usually relate to an increase of personnel, it is more likely that this increase is also in part because ANSPs have to pay for more overtime due to the increase in IFR flight hours seen across the board. This is because, while traffic can increase sharply, it takes a significant amount of time to train an ATCO and thus, for many ANSPs, it is reasonable to deduce that they will not have been able to train new ATCOs at the same rate that the traffic has increased.

The fact that fewer ANSPs saw an increase in employment costs compared with last year may also suggest that while traffic has been increasing for several years, some ANSPs have taken specific measures to mitigate its impact, such as the deployment of new technologies. This reduces the expense of employment costs and improves performance.

Figure 6: ATCOs in OPS Employment cost per ATCOs in OPS hour

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ATCO productivity has increased The ‘ATCOs in OPS hour productivity’ metric measures the performance of ATCOs. It is the number of IFR flight hours controlled for every ATCO in OPS hour.

While ATCO employment costs have increased, the data shows that there has been a concurrent rise in ATCO productivity. 77 percent of ANSPs have seen productivity increases over the last year – with approximately 48 percent of these increases being greater than, or equal to, 4 percent. This represents an increase on last year, when 73 percent of participants experienced productivity increases.

Increases in productivity are closely linked to rising IFR hours; therefore, increasing productivity demonstrates how ANSPs have effectively increased performance to meet the challenge of rising demand. It is also possible that new technologies as well as airspace restructuring may have played a role in improving productivity and performance.

In future years, the relationship between new technologies and human performance will play an increasingly important role in both the efficiency and effectiveness of ANS.

Figure 7: ATCOs in OPS hour productivity

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Cost of service delivery has reduced as ATCO productivity has increased Charting the ‘Cost per IFR flight hour’ against the ‘ATCOs in OPS hour productivity’ highlights the cost of service delivery compared with the productivity of ATCOs. The results show that the ANSPs that increased their ATCO productivity experienced decreases in their cost per IFR flight hour. The most likely explanation is that increased traffic has meant that ANSPs have handled more flights but with the same (or marginal changes in) staffing, leading to increased productivity. Another possibility would be airspace restructuring, where a single controller handles more IFR flight hours while, evidently, not increasing the cost per IFR flight hour.

It is also noteworthy that a decrease in ATCO productivity did not appear to correlate with an increase in unit cost. However, this sample was too small to draw definitive conclusions.

Figure 8: Cost per IFR flight hour/IFR flight hours per ATCO in OPS hours

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Increases in annual employment cost linked to improved productivity The ‘ATCOs in OPS hour productivity/annual employment cost per ATCO in OPS’ graph compares productivity with employment costs.

In 2016 there was a clear correlation between employment costs and productivity, with 58 percent of ANSPs observing simultaneous increases in these two metrics.

Based on the understanding that employment costs are rising due to higher individual employee costs (and not the number of personnel), a possible hypothesis for concurrent rises in productivity and employee costs is that traffic is increasing faster than ATCO availability. An increase in demand can lead to an increase in ATCO productivity. As ATCO productivity cannot continue to rise indefinitely, this not an approach that is viable in the long-term, which means ANSPs will need to find alternate methods of handling increasing traffic. The challenge will be to do this whilst still improving their cost efficiency, and cost efficiency savings may in fact have to come from other parts of an ANSP’s operation.

Figure 9: IFR flight hours per ATCO in OPS hours/ ATCOs in OPS Employment cost per ATCO hour

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Global Air Navigation Services Performance Report 2017 | The ANSP View

Summary Key Findings •

Increases in the volume of traffic have led to decreases in the costs per flight hour

•

ATCO productivity has increased alongside employment cost

•

Cost of service delivery has reduced as ATCO productivity has increased

•

Increases in annual employment costs is linked to improved productivity

Cost efficiency Overall, 2016 saw a return of the trends that were noted in 2013 and 2014 – those of rising traffic and improved efficiency, without the unit cost increases that marked 2015.

What is striking is that this was achieved in a year where, much like in 2015, the ATCO employment costs continued to rise. 67 percent of ANSPs reported an increase, suggesting extensive costefficiency savings were achieved in other areas of the operation. These are likely to vary from ANSP to ANSP but will include savings on frontline service staff employment costs, ATCOs in non-OPS employment costs and capital costs.

This is confirmed by the fact that 52 percent of the ANSPs reduced their ‘Costs excluding ATCOs in OPS employment costs per IFR hour’ metric, which is broken down in more detail in the ANSP View.

Productivity

It should be noted here that productivity can be increased by airspace restructuring as well as the introduction of new technologies, and these may be solutions to the challenge of rising traffic in the future. However, the fact that the ‘Annual employment cost per ATCO in OPS’ increased for 74 percent of participants, suggests that in general this was not the case in 2016.

Meeting global demand While the performance indicators highlight operational improvements, the Members’ data is in accordance with the global trends showing rising passenger numbers (+6.4 percent) and airport movements (+2.0 percent).

As air passenger forecasts signify strong continued growth in the near future, however, the critical message from this report is that ANSPs must continue to find ways of accommodating growing demand efficiently and effectively to support sustainable and safe ATM operations.

In line with what was observed last year, ATCO productivity increased for a significant number (77 percent) of participating ANSPs. It appears that Members successfully responded to the increase in traffic by improving ATCO productivity and, as a result, reduced unit costs.

The challenge will be to ensure that this is sustainable going forward. ATCO productivity cannot rise indefinitely, but a significant increase in ATCO hiring would also be problematic from an efficiency and productivity standpoint if and when there is another downturn in traffic.

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Global Air Navigation Services Performance Report 2017 | The ANSP View

Acronyms and Abbreviations ACI ANS ANSP ASK ATAG ATC ATCO ATM CANSO GBWG

Airports Council International Air navigation services Air navigation service provider Available seat kilometres Air Transport Action Group Air traffic control Air traffic controller Air traffic management Civil Air Navigation Services Organisation Global Benchmarking Workgroup

GDP

Gross domestic product

IATA

International Air Transport Association

IFR

Instrument flight rules

KPI

Key performance indicator

OPS

Operations

PPP

Purchasing power parity

RPK

Revenue passenger kilometres

USD

United States Dollar

VFR

Visual flight rules

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Global Air Navigation Services Performance Report 2017 | The ANSP View

Sources www.aviationbenefits.org www.aci.aero/News/Releases/Most-Recent/2017/10/06/The-bigger-get-biggerwhile-smaller-airports-suffer-greatest-loss www.iata.org/pressroom/facts_figures/fact_sheets/Documents/fact-sheet-industry-facts.pdf www.iata.org/publications/Documents/iata-annual-review-2017.pdf www.atag.org/facts-and-figures.html

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civil air navigation services organisation

TRANSFORMING

GLOBAL ATM PERFORMANCE