Presentation on theme: "U.S. Domestic Analysis ATN ‘99 September 22, 1999 www.boeing.com/caft The Business Case for Digital Data Link."— Presentation transcript:
U.S. Domestic Analysis ATN ‘99 September 22, 1999 www.boeing.com/caft The Business Case for Digital Data Link
The CNS/ATM Focused Team “C/AFT” XAn Informal Industry Group Airlines Airframe Manufacturers (Boeing, Airbus) Air Traffic Service Providers (FAA, Eurocontrol) Associations (ATA, IATA) Research Organizations (MITRE/CAASD, NASA, LMI) XFocus is Business Case Development Establish Problem -- Why do we need to change? Quantify Solutions -- What to do, and when? Develop Consensus -- How do we move forward?
Airline Data Link Commitment Key Questions XIs there a valid economic basis for airlines to commit to investment into ATC data link? XWhat short and long term airline benefits are there for investment in ATC data link? XIs there a “Window of Opportunity” for maximizing the return on this investment? XHow does ACARS fit in to this issue? XWhat is the value of ATC data link as an enabling technology for future applications? XDoes this define a “Benefits Driven” approach?
CNS/ATM Focused Team Overview XIntroduction & Assumptions XAOC Situation XATC Situation XC/AFT Modeling Process XModel Inputs XInvestment Analysis Results XPotential Future Data Link Benefits XConclusions
CNS/ATM Focused Team Introduction XC/AFT airlines agree that future system capacity is a primary driver for global airspace changes. XC/AFT proposes incremental operational enhancements that can be enabled by CNS technologies. XC/AFT analyzed Digital Data Link as a primary enabler for ATC delay reduction. XBusiness case development was based on analysis of costs and benefits from the U.S. airlines’ perspective.
CNS/ATM Focused Team Scope of This Analysis XThis is not an alternatives analysis, as data link is the only enabler considered. XAnalysis is for Cruise/Terminal Transition area capacity improvements in U.S. NAS. XValue is based on airline point of view (airlines as an industry, not a single airline). XBoth AOC and ATC benefits considered. XAnalysis includes value of transitioning from Plain Old ACARS (POA) to VDL Mode 2 for AOC.
CNS/ATM Focused Team Airline Operations Control Why the Need for Change? XACARS Demand is Increasing New aircraft being delivered New airline users entering service New applications and non-airline users XACARS is a Shared-Access System Based on non-discriminatory system of FCC frequencies XSpectrum Availability and Congestion Limited number of VHF frequencies Interim ACARS expansion is short-lived and expensive
CNS/ATM Focused Team Airline Operations Control Increasing U.S. Demand for Service XGrowing number of ACARS aircraft in U.S. Today: Approx. 5600 U.S. + 1500 Non-U.S. = 7100 Future: Up to 1200 more over next 3 to 5 years XPotential new demand from new participants Civil: Large Scheduled (Regional), Cargo, & Business Military: Non-Tactical Aircraft, Air National Guard Estimated potential at more than 4500 additional a/c XIncreasing number of data link applications Aircraft Performance Crew Management In-flight Operations
CNS/ATM Focused Team Managing spectrum congestion and availability will be a growing and continuing concern for the airline industry. Spectrum Issues Congestion and Availability XNew applications are the primary reason for increasing demand for ACARS. XNew data link users entering service is the secondary reason for increasing demand. XMany areas of US already already experiencing congestion on en route frequencies. XOther industries are looking and petitioning for available spectrum.
ACARS Demand Will Exceed Capacity ARINC, Inc
CNS/ATM Focused Team The Digital Solution (VDL-2) XMigration of ACARS traffic to VDL-2 will effectively address projected frequency congestion XSignificant costs related to expanding interim ACARS capacity may be avoided XATC Data Link is a common element in most new applications related to ATC modernization and airspace management
CNS/ATM Focused Team ATC Data Link Situation XAmerican Airlines study of impact of delay on airline schedule Without capacity improvements airline flight schedule critically impacted by year 2005. By reducing separation, airline schedules can be maintained. XResults from FAA study of Cruise/Terminal Transition area data link shows significant delay reduction potential Reduce voice frequency congestion. Off-loads routine comm from radar controller, allowing improved ATC services for increased sector productivity and efficiency. XFAA has funding baseline for Builds 1 and 1a CPDLC Based on ATN over VDL Mode 2. XPETAL-II trials in Europe underway to evaluate data link operational implementation issues.
CNS/ATM Focused Team FAA’s Data Link Program Based on ATN over VDL-2 XBuilds 1 and 1A are subset of PETAL-2 XBuild 2 includes initial oceanic message support XBuild 2 has international scope Eurocontrol and European States requesting joint FAA collaboration to define follow-on data link implementation project. XBuild 2 follow-on activity expected to be key in setting the international standard for ATC data link in congested, highly developed airspace. XBuild 2 will define the beginning of the transition from FANS-1 to ATN.
CNS/ATM Focused Team C/AFT Modeling Process Transition Logic Diagrams XC/AFT is proponent of incremental operational enhancements XTransition Logic Diagrams separate diagram for each phase of operation developed for both capacity and efficiency operational enhancements “enabled” by technology or procedural improvements XC/AFT analysis focuses on capacity-related improvements Reduced separations Additional routes
CNS/ATM Focused Team Aircraft Separation Rings Sensor Display Short-Term Intent Controller Comm: a/g Pilot Closure Rate Display Weather Medium-Term Intent Data Controller Comm: g/g Pilot Flow Rates Airspace Complexity Required Element Performance RxP = f (sensors, decision support, human) Required System Performance sets Separation Standard RSP = g ( RCP, RMP, RNP ) Sensor Display Controller Pilot TheoreticalEffectiveResource-Constrained Effective Prevention Intervention Detection RNP, RMP, RCP RMP, RCP RMP Resource-Constrained
CNS/ATM Focused Team The First Step: Controller Communications Workload 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Strip MgmtExt CoordInt CoordConf SrchR/TRdr CoordRdr SuperRdr Interv "SYSCO" Approximate Controller Workload Distribution
14 Atlanta study baseline. Data Link used for Clearances and Transfer of Comm 5. Cruise/Terminal Transition Area Transitions More Published SIDs and STARs Airplane-Level Capacity Effects System-Level Capacity Effects More Vertical Profiles Reduced Prevention Buffer Redistributed Controller Comm Workload Reduced Intervention Buffer Reduced Separation Minima State Vector Prediction XFAA Atlanta Study XCruise/Terminal Transition Sector handles arrival sequencing, overflight traffic, and departures XRestrictions are enforced due to communication volume saturation XProblem: During peak periods 20 Miles in Trail (MIT) for departures entering sector, resulting in ground delays XResult: Using data link for routine voice communications allowed reduction from 20 MIT to 5 MIT (62% delay reduction)
CNS/ATM Focused Team C/AFT Modeling Process Probabilistic Economic Model XDetermines Costs Benefits (converted to dollars) Risk Rules XBuilds Deterministic Sensitivity Analysis Identifies influence of each uncertainty on NPV Used to calculate overall risk and return
Data Link Investment Model Full Influence Diagram
CNS/ATM Focused Team Data Link Investment Model Structured Influence Diagram Equipage Model Infrastructure Model Upfront Investment Model Net Benefits Model Infrastructure Timing Infra Effectiveness AOC Readiness Cash Flows Forward Fit and Retrofit Equipage Rates (+) Delay Reduction AOC Savings FF POA Penalties Non-AOC Availability (-) Equipage Costs S/W Upgrade Costs Airline Host Costs New Deliveries Delay Growth Curr Delay/Flight (-) ATC S/W Maint Annual Message Costs Total Planes FF Planes Retrofit Planes Airplanes Retired
CNS/ATM Focused Team Model Inputs Constants XStart Year of Model2000 XFinal Year for Equipage2015 XFinal Year for Benefit2020 XDiscount Rate12% XInflation Rate3.5% XDirect Operating Cost (DOC)$25 per minute (Not including ownership costs) XFuel % of DOC30% XFuel inflation rate5%
Model Inputs Delay Growth XDerived from Free Flight, Preserving Airline Opportunity, by American Airlines, Fig. 4 XLarge range of this variable due to: AA study was using conservative good weather day estimate This represents delay over optimum (not schedule) This accounts for value of unmet traffic growth due to capacity constraints
CNS/ATM Focused Team Model Inputs Traffic Growth XNumber of planes at start of model: 5194 (Source: ATA) XNumber of planes in 2015: Low Estimate: 8054 Medium Estimate: 8943 High Estimate: 9289
CNS/ATM Focused Team Model Inputs Infrastructure XModel includes both AOC and ATC Infrastructure XCPDLC Builds have an associated “Delay Reduction Effectiveness” which represents the percentage of data link-related delay that is affected with each build.
CNS/ATM Focused Team Model Inputs Infrastructure
CNS/ATM Focused Team XStage 0 Tied to AOC infrastructure readiness AOC benefits biggest driver (message cost reduction and penalty avoidance) No ATC delay reduction benefits High forward fit of VDL-2 equipment, low retrofit XStage 1 Tied to ATC infrastructure readiness Both ATC delay reduction and AOC benefits Increased forward fit, med retrofit Ends when airlines equip more aggressively due to infrastructure maturity and realized benefits XStage 2 Tied to ATC infrastructure maturity Both ATC delay delay reduction and AOC benefits Increased forward fit, high retrofit Model Inputs Three Stages of Equipage
CNS/ATM Focused Team Model Inputs Equipage Relationship to FAA Program Stage 0 2000200520102015 Stage 1 ATC Bld 1 Start (2002,2003,2004) ATC Bld 1/ATC Bld 1A/ATC Bld 2 End Stage 2 2015 Bld 1Bld 1ABld 2 Equipage Stages Infrastructure Builds Note: All graphics reflect base case values
CNS/ATM Focused Team Model Inputs Equipage Percentages
CNS/ATM Focused Team Model Inputs Costs XATM Infrastructure costs not included XEquipment costs assumes minimal avionics and flight deck impact CMU, VDR, wiring XEquipment Costs Aircraft Forward Fit and Retrofit for AOC CMU Software upgrade for ATC Airline host or router upgrade for AOC XATC Message Costs Who will pay? FAA, airlines, or both? Multiplying Factor takes into account this uncertainty
CNS/ATM Focused Team Model Inputs Costs
CNS/ATM Focused Team Model Inputs Costs XMaintenance costs 10% per year of ATC software upgrade cost XMessage costs $.18 per Kbit for 0 - 1 million Kbits/year $.14 per Kbit for 1 - 4 million Kbits/year $.10 per Kbit for 4 - 8 million Kbits/year $.06 per Kbit for 8 - 15 million Kbits/year $.05 per Kbit for > 15 million Kbits/year
CNS/ATM Focused Team Model Inputs AOC Benefits XAOC Non-Availability Cost to an airline of not having full ACARS capability ($16, $32, $48 per flight) XAOC message cost reduction Cost-per-Kilobit savings and message length reduction (discount factor 0.67, 0.8, 0.86) XAOC Penalty Avoidance for VDL-2 equipage Cost-per-Kilobit penalty (3%, 5%, 10% increase per year) Monthly Surcharge ($900, $1000, $1100 per month)
Model Inputs ATC Benefits XDelay reduction benefits applied to all airplanes, not just those equipped XATC Delay Reduction Benefit Based on Atlanta study; scaled study benefits Assigned delay reduction % to each FAA Build XUses the following formula: Atlanta NAS-wide benefits * discount factor * annual delay growth Atlanta NAS-wide benefits = 11,491,387 minutes saved in Cruise/Terminal Transition phase of flight Discount Factor = 30%, 50%, or 80% of Atlanta-study benefits Annual Delay Growth = 2.5%, 7%, 11% per year
Model Inputs Delay vs. Equipage Curve
Data Link Scenario Comparison Return on Investment CNS/ATM Focused Team Data Link Analysis (April 1999)
Full Data Link Scenario Cost Drivers by Category ($000’s) CNS/ATM Focused Team Data Link Analysis (April 1999)
Full Data Link Scenario Benefit Drivers By Category ($000’s) CNS/ATM Focused Team Data Link Analysis (April 1999)
Full Data Link Scenario Deterministic Sensitivity
Full Data Link Scenario Cumulative Probability of Return (NPV) CNS/ATM Focused Team Data Link Analysis (April 1999)
CNS/ATM Focused Team Full Data Link Scenario Cash Flow Summary $9.0 Billion
CNS/ATM Focused Team Full Data Link Scenario Forward Fit - Cash Flow Summary $3.6 Billion
CNS/ATM Focused Team Full Data Link Scenario Retrofit - Cash Flow Summary $3.8 Billion
CNS/ATM Focused Team Full Data Link Scenario Value of Perfect Information and Control Value of Perfect Information: The value of knowing the outcome of an uncertainty before you make the investment decision. Value of Perfect Control: The value you of ensuring that the outcome of an uncertainty comes out to the most favorable outcome for your decision. Note: These calculations assume a 25% chance of the 10th percentile event occurring, a 50% chance of the 50th percentile event occurring, and a 25% chance of the 90th percentile event occurring. Selected Chance VariablesVOPIVOPC Equipage Scenario0.0$520M Delay Incr % per Yr0.0 512 ATC Build 1A Eff %0.0 25 Atlanta Discount Factor0.0 452 AOC NA Strt Yr0.0 242 ATC SW Upgrade $K0.0 177 AOC NA ($ per Flt)0.0 575
CNS/ATM Focused Team Model Outputs AOC Only XAOC-only scenario uses Stage 0 equipage rates Forward Fit per Year25%, 60%, 75% Retrofit per Year2%, 3%, 4%
AOC Only Scenario Cost Drivers by Category ($000’s) CNS/ATM Focused Team Data Link Analysis (April 1999)
AOC Only Scenario Benefit Drivers by Category ($000’s) CNS/ATM Focused Team Data Link Analysis (April 1999)
AOC Only Scenario Deterministic Sensitivity CNS/ATM Focused Team Data Link Analysis (April 1999)
AOC Only Scenario Cumulative Probability Distribution CNS/ATM Focused Team Data Link Analysis (April 1999)
CNS/ATM Focused Team AOC Only Scenario Cash Flow Summary $3.5 Billion
CNS/ATM Focused Team AOC Only Scenario Forward Fit - Cash Flow Summary $2.1 Billion
CNS/ATM Focused Team AOC Only Scenario Retrofit - Cash Flow Summary $1.5 Billion
AOC Only Scenario Value of Perfect Information and Control (Stage 0 Equipage Rates) Value of Perfect Information: The value you should be willing to pay to know the outcome of an uncertainty before you make the investment decision. Value of Perfect Control: The value you should be willing to pay to ensure that the outcome of an uncertainty comes out to the most favorable outcome for your decision. Note: These calculations assume a 25% chance of the 10th percentile event occurring, a 50% chance of the 50th percentile event occurring, and a 25% chance of the 90th percentile event occurring. Selected Chance VariablesVOPIVOPC Equipage Scenario0.0$301M AOC NA Strt Yr0.0 148 AOC NA ($ per Flt)0.0 349 AOC Cost per Flt0.0 98
CNS/ATM Focused Team Conclusions XData link is a strategic, long-term investment. XData link has a reasonable return on investment. XThe value of maintaining AOC data link capability is one of the primary cost-avoidance drivers. XAOC drives forward fit, ATC drives retrofit. XThe AOC benefits enable airline equipage. XRisks associated with investing in ATC data link are mitigated by the need to preserve AOC.
CNS/ATM Focused Team Conclusions XForward Fit equipage must start ASAP to avoid the high retrofit costs. XATC benefits are particularly dependent on successfully managing those factors with the most variance of NPV (deterministic sensitivity).
CNS/ATM Focused Team Potential Future Benefits Enabled by ATC Data Link A Rough-Order of Magnitude Analysis
CNS/ATM Focused Team International / National Improved TFM Collaborative Traffic Management Enhanced Arrival Planning Integrated Airport Flow Planning Coordinated TFM System National / Local / Airport 1. Planning Capacity Transitions C1-1 C1-5 C1-4 C1-3 C1-2 ADS intent information allows for improved terminal area arrival flow planning.
CNS/ATM Focused Team Additional Gates, Taxiways and Aprons Reduce Schedule Uncertainty Improved Surface Sequencing, Scheduling and Routing Improved Surface Guidance and Control Visual Throughput in CAT IIIb Good Visibility Low Visibility 2. Surface Capacity Transitions C2-1 C2-5 C2-4 C2-3 C2-2 Detroit Digital Taxi Clearance baseline. Use CPDLC to provide taxi clearance.
CNS/ATM Focused Team 3. Final Approach / Initial Departure Capacity Transitions Increased Availability of Approaches/Departures Reduced Prevention Buffer Reduced Intervention Buffer Airplane-Level Capacity Effects System-Level Capacity Effects Reduced Separation Minima Increased Runway Utilization C3-3 C3-4 Reduced longitudinal spacing C3-5 Reduced Separation Minima 3-Dimensional Approaches Only C3-8 C3-7 C3-2 C3-1 Additional Runways C3-6 Reduced Separation Minima Reduced lateral spacing between runways Use ADS to reduce lateral separation for independent operations to 2500’.
CNS/ATM Focused Team 4. Approach / Departure Transition Capacity Transitions Reduced Separation Minima More Transitions Reduced Prevention Buffer Increased Availability of Existing Transitions Airplane-Level Capacity EffectsSystem-Level Capacity Effects Reduced Intervention Buffer Ground Vectoring C4-2 C4-1 Reduced Intervention Buffer Ground Guidance with A/C trajectories C4-3 Reduced Intervention Buffer A/C Guidance C4-4 C4-5 C4-6C4-7 Use ADS with CTAS for more efficient sequencing. Use CPDLC with 4-D Nav for accurate arrival at the final approach fix. TBD
CNS/ATM Focused Team Reduced Separation Minima TBD Reduced Intervention Buffer Reduced Prevention Buffer Redistributed Controller Comm Workload State vector prediction Newark study baseline. Data Link used for Clearances and Transfer of Comm ADS used to provide med-term state vector information to CTAS for improved sequencing and spacing. 4-D contract: ADS for intent, and CPDLC for trajectory coordination. OR Improved performance of CPDLC allows for reduced controller intervention. 5. TMA Arrival/Departure Capacity Transitions More Published SIDs and STARs Airplane-Level Capacity Effects System-Level Capacity Effects More Vertical Profiles C5-1 C5-6C5-5 C5-4 C5-3 C5-2
ADS used to provide position data to ATC. TBD Reduced Prevention Buffer C6P-1 6. En-Route Capacity Transitions (Procedural Separations) Airplane-Level Capacity Effects Reduced Separation Minima 50/50 Horizontal C6P-3 Reduced Intervention Buffer C6P-2 Reduced Separation Minima 30/30 Horizontal C6P-4 Reduced Separation Minima 15NM radius C6P-5 Reduced Separation Minima < 15NM radius C6P-6 More Published Routes System-Level Capacity Effects More Flight Levels C6P-8C6P-7
CNS/ATM Focused Team Reduced Separation Minima TBD Reduced Intervention Buffer Reduced Prevention Buffer State vector prediction More Published Routes Airplane-Level Capacity Effects System-Level Capacity Effects Reduced Prevention Buffer Redistributed Controller Comm Workload More Flight Levels C6R-1 C6R-6C6R-5 C6R-4 C6R-3 C6R-2 Atlanta study baseline. Data Link used for Clearances and Transfer of Comm ADS used to provide state vector information for medium-term trajectory prediction. 4-D contract: ADS for intent, and CPDLC for trajectory coordination. OR Improved performance of CPDLC allows for reduced controller intervention. 6. En-Route Capacity Transitions (Radar Separations)
CNS/ATM Focused Team Future Data Link Model Assumptions (1 of 2) This analysis provides only a rough-order-of-magnitude of some of the enabling benefits of future data link. With that in mind, these are the assumptions we made: X12% discount rate and 3.5% inflation XCash flows start in 1998 and end in 2015 XAssumed no revenue enhancement XNo costs are included XThe following model assumptions are the same as the baseline data link analysis, including: Equipage and infrastructure timing Relationship between equipage and delay reduction Airplane deliveries and airplanes removed Growth in delay XAssessed an 11% full-up delay reduction (vs. 5% for baseline data link) [See next page]
CNS/ATM Focused Team Future Data Link Model Assumptions (2 of 2) Source of Delay: X% of Delay Surface = 5.75% X% of Delay Final App/Init Dep = 41.85% X% of Delay App/Dep Transition = 19.8% X% of Delay TMA Arrival/Departure = 20.5% Delay Reduction %: XSurface Delay Red = 69.5% XFinal App/Init Dep Delay Red = 19.3% XApp/Dep Transition Delay Red = NA XTMA Arrival/Departure Delay Red = 13.1%
Future Data Link Deterministic Sensitivity
Future Data Link Cumulative Probability Distribution
CNS/ATM Focused Team Conclusions XThe magnitude of the potential value enabled by ATC data link are substantial. XA more complete economic analysis will not be possible until operating concepts, along with associated benefits and costs, are better defined.
CNS/ATM Focused Team Questions?
CNS/ATM Focused Team Backup Information ATN ‘99 September 22-23, 1999 www.boeing.com/caft
CNS/ATM Focused Team Model Inputs Traffic Growth XStart with current number of airplanes, add new deliveries and subtract retiring planes each year 1997 Total Number of Airplanes 5194 (ATA) New Deliveries per Yr (1998 to 2007) 233 (Boeing CMO) New Deliveries per Yr (2008 to 2017) 326 (Boeing CMO)
CNS/ATM Focused Team Model Inputs Equipage Timing Variables