Efficiency Analysis and Target Setting of Spanish Airports

In this paper an efficiency analysis of 41 Spanish airports is carried out. A description of the physical infrastructure of the airports, namely total runway area, apron capacity, passenger throughput capacity, number of baggage belts, number of check-in counters and number of boarding gates, is used as inputs. Air Traffic Movements, Passenger Movements and Cargo handled are used as outputs. An output-oriented, Variable-Returns-to-Scale, non-radial Data Envelopment Analysis (DEA) model is used to compute the Russell measure of output technical efficiency. Half of the airports are found technically efficient. Scale efficiency and local Returns to Scale have also been assessed, indicating that except for a few airports that operate at their Most Productive Scale Size, for most Spanish airports Increasing Returns to Scale prevail. An original DEA model for target setting and scenario analysis is also proposed. The model uses two parameters (Plane Load Factor and Passenger/Cargo Ratio) that allow the relating of two of the outputs to the third. The model computes efficient targets given the value of these two parameters and the vector of available inputs. The results of this target-setting DEA model for Seville airport for different values of the two parameters and different future input scenarios are presented.