Capital efficiency at airports and related services

To deliver the aviation networks of the 21st century, it will be essential for regulators, airport operators and air navigation service providers to invest in both a timely and efficient manner. Yet applying the benchmarking and efficiency assessments that have helped yield improved operational performance poses a substantial challenge when those tools are applied to capital investment. This paper assesses four aspects important to meeting this challenge. First, the potential difficulties associated with efficiency assessment in the context of capital investment are identified. Second, developments in the methodologies and tools available to operators and regulators are outlined. Third, the experiences and lessons of applying these tools in the aviation sector are assessed. Finally, while the authors remain cautiously optimistic over the future possibilities for assessing capital efficiency in the aviation sector, they conclude by arguing that there is a significant role for regulatory incentives to complement efficiency assessments.