1

Performance indicators, targets, steering Performance indicators, targets, steering

Technical Interchange meeting

Toulouse, 15-17 May 2002

Xavier FRON

Head Performance Review Unit

2

ECAC institutional strategyECAC institutional strategy

A Performance oriented strategy PRC role

– Measure performance (KPI)• Safety, delays, cost

– Propose performance targets

– Recommendations to meet targets

3

European IFR traffic demandEuropean IFR traffic demand

In 10 years

Flights:

+60% (4.8%p.a.)

Distance:

+80% (6% p.a.)

In 2001

Flights: -0.6%

Distance: +0.2% 3000

3500

4000

4500

5000

5500

6000

6500

7000

7500

8000

1990

19911992

19931994 1995 1996 1997

19981999

2000

20012002

Traffic Forecast (High/Low bound)

Actual Traffic

Fli

ghts

(‘

000s

)

4

Key Performance AreasKey Performance Areas

Cost -Effectiven

ess

Total unit costs do not increase(routes charges

+ delays)

Capacity - Delay

Meet traffic demand

Safety

Total numbers of incidents,

accidents capped

AT

M

20

00

+

5

• ATM 2000+ target set • But no reliable performance indicator

Safety targetSafety target

0

1

2

3

4

8 9 10 11 12 13 14 15 16

Traffic (million flights)

Risk trend

Risk target

Actual risk?

• Cannot assess if target being met

6

Air transport delaysAir transport delays

Flightschedule

Actual

Arrival delay

Buffer

Taxi Out Airborne Taxi In

Take off Landing

Departuredelay

Delay

Schedule

Unconstrained flight

Out Off InOn

A i r l i n e2 6 %

A T F M2 1 %

W e a th e r3 %

A i rp o r t9 %

O th e rs4 %

R e a c tio n a ry3 7 %

D a ta S o u r c e : C O D A

Departure delays

7

Traffic-delay-capacity relationship

Traffic-delay-capacity relationship

0

40000

80000

120000

160000

200000

0 5000 10000 15000 20000 25000 30000Average daily Traff ic (f lights)

Avg

Enr

oute

Dai

ly D

ela

y (m

inut

es)

Week 98 WeekEnd 98

Week 00 WeekEnd 00 Week - End

Week

Data Source : CFMU

•Traffic/delay relationship•Very non-linear response•Capacity gain => large delay reduction

8

Measuring capacityMeasuring capacity

y = 5x - 0.15

R2 = 70%

y = 7x - 0.15

R2 = 83%

y = 0.5x - 0.12

R2 = 1%

-100%

-80%

-60%

-40%

-20%

0%

20%

40%

-10% -8% -6% -4% -2% 0% 2% 4%

Traffic Variation

De

lay

Va

ria

tion

s

2001 Average Delay Variation2001 Average EnRoute Delay Variation2001 Average Airport Delay VariationLinear (2001 Average Delay Variation)Linear (2001 Average EnRoute Delay Variation)Linear (2001 Average Airport Delay Variation)

Source : CFMU

T

dTk

D

dD

k

T

T

D

D

00

k

D

DTT

1

00

Effective capacity: traffic handled at optimal delay

9

Effective capacity (yearly)Effective capacity (yearly)

2001: ATFM en-route delay cost to airspace users ~ € 1100-1700 M

10

Effective capacity (monthly)Effective capacity (monthly)

15.000

17.000

19.000

21.000

23.000

25.000

27.000Ja

n 19

97

Jul 1

997

Jan

1998

Jul 1

998

Jan

1999

Jul 1

999

Jan

2000

Jul 2

000

Jan

2001

Jul 2

001

Jan

2002

Month

Flig

hts

Daily traff ic

Effective capacity

Kosovo

ARN V3/3NERC

Data Source : CFMU

11

Cost of capacityCost of capacity

90

100

110

120

130

140

150

160

170

180

190

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Total Costs

Effective capacity

Source : CRCO & PRU

Linearrelationship

12

Delay/capacity targetsDelay/capacity targets

Capacity/demand ratio0.7 0.8 0.9 1 1.1 1.2 1.3

Yea

rly

cost

s

Delay costs

Capacity costs

Total economic cost of ATM

Optimum

€ 4000 M

€ 1500 M

Agreed ECAC delay target: 1 minute per flight

13

ECAC capacity target: Meet traffic demand...

ECAC capacity target: Meet traffic demand...

14

Delay targetDelay target

3.12.9

4.1

5.5

3.6

0

1

2

3

4

5

6

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Summer en-route ATFM delay

Min

ute

s p

er

Flig

ht

Optimum delay Target delay Actual delay

Data Source: CFMU

Key performance indicator (ECAC)

15

Reaching Delay/capacity targetsReaching Delay/capacity targets

ECAC delay target ACC capacity targets

ECAC delay forecast ACC capacity commitments

16

Simple ACC capacity modelSimple ACC capacity model

T (Flights/h)

Time6h 22h

Capacity

D=(T- T0)/2 T0 *S

ST0

Delay

TT0

17

ACC capacity ACC capacity

0

50000

100000

150000

200000

250000

300000

0 5000 10000 15000 20000 25000 30000

Weekend Actual delays

Week days Actual delays

Weekend Estimated delays

Week days Estimated delays

Week-ends Week days

To reach system delay targetACC Traffic & Delay

0

5000

10000

15000

20000

25000

30000

0 500 1.000 1.500 2.000 2.500

Traffic

Del

ay (

Min

ute

s)

Actual

Estimated

Individual ACC capacity targets

18

ECAC economic objectiveECAC economic objective

0,00

0,20

0,40

0,60

0,80

1,00

1,20

1998 1999 2000 2001

Eu

ro/k

m

Total cost should not increaseIs this adequate?

19

Cost targetsCost targets

• No absolute reference

• Continental benchmarking

Initial US/Europe comparison – IFR flights x 2– Total cost x ~1.15 – Similar number

of air traffic controllers

6 6 7

3 8 0

4 9 2

8 3 8

0

1 0 0

2 0 0

3 0 0

4 0 0

5 0 0

6 0 0

7 0 0

8 0 0

9 0 0

T o ta l A N S c o s ts p e rIF R f lig h t

T o ta l A N S c o s ts p e r1 0 0 0 km

EURO

E U R O C O N T R O L A re a F A A

20

Breakdown of cost effectivenessBreakdown of cost effectiveness

0

20

40

60

80

100

120

140

160

180

200

ANS costs per ATCO ATCOs per sectorw orking position

IFR km f low n per sectorw orking position

EUROCONTROL Area FAA (Index = 100)

21

ECAC cost target (qualitative)ECAC cost target (qualitative)

t

Efficiency frontier

Frontier shift

Catch up

Present trend

Desirable trend

Unit cost

22

ANSP cost-effectivenessANSP cost-effectiveness

• 2001 route charges: 4800 million Euro– Is this appropriate?

• Substantial variance in unit ratesMin=21, Max=114 Euro– Is this justified?

• Unit costs (per km) rising in real terms– ATM system less cost-effective ? – Indication of investment for future capacity ?

23

Key Performance Indicator (State view)

Key Performance Indicator (State view)

0,0

0,2

0,4

0,6

0,8

1,0

1,2

Uni

ted

Kin

gdom

Sw

itzer

land

Bel

gium

-Lux

.

Bul

garia

Can

aria

s

Ger

man

y

Aus

tria

Slo

vak

Rep

.

Rom

ania

Italy

FY

RO

M

Net

herla

nds

Fra

nce

Slo

veni

a

Spa

in

Por

tuga

l

Mal

ta

Den

mar

k

Sw

eden

Nor

way

Cro

atia

Tur

key

Gre

ece

Hun

gary

Cze

ch R

ep.

Irel

and

Cyp

rus

Eur

o 20

00/k

m

0,0

0,2

0,4

0,6

0,8

1,0

1,2199820002002

Eurocontrol Average 2000

Data source : CRCO

24

BenchmarkingBenchmarking

SE

ES

ROPT

NO

NL

IT

IEHU

GR

DE

FR

DK

CZ

CY

BG

BEAT

CH

TR

GB

10

100

1.000

10 100 1.000

Estimated cost (millions EURO)

Ob

se

rve

d c

os

t (m

illio

ns

EU

RO

)

REGRESSION LINE

Observations : 85 Adjusted R2 : 0.98Dependent variable : total en-route costs

Ln C = a0+ a1 ln K+ a2 ln D+ a3 ln (1+A/K)+ a4 ln 5 T

Explanatory variables Coefficient t-stat(Constant) a

0 -4.44 -11.4

kilometre (K) a1 1.10 51.4

density (D) a2 0.26 9.9

Airport Mvt/kilometre (A/K) a3 37 3.0

time (T) a4 -0.05 -3.6

1999 2000

Bulgaria + 85% + 93%Portugal + 32% + 74%Romania + 4% + 44%Austria + 57% + 35%United Kingdom + 22% + 31%Turkey + 42% + 14%Norway - 3% + 12%Denmark + 4% + 8%Italy + 1% + 2%Switzerland - 1% - 1%Greece + 8% - 3%Czech Rep. - 3% - 4%Cyprus - 9% - 4%Spain - 9% - 4%Belgium-Lux. - 5% - 5%Sweden - 7% - 5%Germany - 13% - 14%France - 13% - 15%Ireland - 11% - 19%Netherlands - 15% - 19%Hungary - 32% - 22%

25

BenchmarkingBenchmarking

Unit cost model takes weighted density and climb/descent into account

0.00

0.20

0.40

0.60

0.80

1.00

1.20

Uni

ted

Kin

gdom

Ger

man

y

Bel

gium

-Lux

.

Sw

itzer

land

Fra

nce

Net

herla

nds

Italy

Aus

tria

Spa

in

Sw

eden

Den

mar

k

Hun

gary

Tur

key

Cze

ch R

ep.

Gre

ece

Nor

way

Rom

ania

Bul

garia

Irel

and

Por

tuga

l

Cyp

rus

Eur

o /

km Actual

Estimated

26

Cost-effectivenessCost-effectiveness

KPI Working Paper (www.eurocontrol.int/prc)

InputsInputs(Resources)(Resources)

OutputsOutputsControlled traffic Controlled traffic

CapacitCapacityy

Efficiency Efficiency of of allocationallocation

Cost- Cost- effectiveneffectivenessess

Cost / controlled flight hours

Productive Productive efficiencyefficiency

ATM costs / sectors hours openFlight hours controlled / ATCO

27

Information disclosureInformation disclosure

An obligation

to disclose information

about monopoly

ATM activities

Separation of accounts• ATM and non-ATM• En-route from other ATM

Yearly disclosure of information• Contextual• Financial• Operational• Forward-looking

Independently Audited

28

Information disclosureStatus

Information disclosureStatus

• Developed with 17 ANSPs in 2001• Cost-effectiveness analysis framework (KPIs)• Specification (V2) has been adopted• 2000 data submitted and analysed (voluntary basis)• 2001 data due by 15 July 2002

29

European ATM performance summary

European ATM performance summary

SafetyNo reliable safety indicator

CapacityATFM Delay costs in 2001: 1.1-1.7 billion €Improvement anticipated in 2002Be prepared for future traffic growth

Cost effectiveness En-route + terminal charges ~ 6.2 billion € Unit cost: 70% above US

Potential net savings ~ € 1-2 billion

30

“Soft” regulation“Soft” regulation

• Safety– European safety indicator needed

• Capacity/costs– ECAC target – Publication by ANSPs of own performance targets, accountability, autonomy, incentives– Consolidation by EUROCONTROL– Loop in case of divergence

“Hard” regulation or alternative if insufficient

31

Success test for the ECAC Institutional strategy

Success test for the ECAC Institutional strategy

t

Cost

0

1

2

3

4

8 9 10 11 12 13 14 15 16

Traffic (million flights)

Risk

3.12.9

4.1

5.5

3.6

0

1

2

3

4

5

6

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Summer en-route ATFM delay

Min

utes

pe

r F

light

Optimum delay Target delay Actual delay

Data Source: CFMU

ATFM delay