When it comes to deciding which baggage handling system (BHS) is more cost-effective, often focus is on the initial capital investment, with a prevailing perception that conventional conveyor systems are less expensive than Individual Carrier Systems (ICS). But this is not always a given and if recurring costs are also factored in, ICS can often prove more cost-effective. It really depends.
This article explores the considerations to take into account when determining which BHS system will be the more cost-effective solution.
It must be said from the outset that it’s difficult to determine with certainty which BHS is more cost-effective as there are a myriad of varying factors that come into play.
Take the technical requirements an airport may have of its BHS.
The price per metre of a system, for example, will always depend on the requirements the system must deliver. Other questions may be:
But there are other considerations impacting the price of a system. The cost of installing the system will depend on whether it’s a brownfield installation involving numerous phases or a greenfield installation for which an empty building is available.
The cost of system delivery and logistics will also influence the overall price of a system. It’s more costly to install a system in-country than it is on a coastal site and wages will vary depending on location.
Moreover, as baggage handling consultant Blair Cox of JSM & Associates notes, it really depends on the airport’s paramount aims and how it wants to prioritise its costs. An airport whose primary concern is the cost of energy will have a vastly different approach and rationale than an airport mostly concerned about the price of maintenance or the impact on the environment.
That being said, if we calculate the costs at the level of each cost area and assess these over the life of a system, we can start to draw some conclusions on the cost-effectiveness of different systems.
Let’s start with CAPEX: how does the CAPEX of each system compare?
Again, this will depend on many factors, such as the size of the system. The CAPEX of small systems with simple functionality will likely be similar irrespective of the BHS. Larger systems with many specifications, however, will involve quite different CAPEX.
Here are some considerations.
Firstly, does the airport have enough space to accommodate a conveyor system that is able to perform all its required functionalities?
More equipment is needed in conventional systems, necessitating greater space. Achieving the best possible tracking with conveyors, for example, requires a lot of space between bags and a slower processing speed. ICS, by comparison, can deliver flawless tracking at faster processing speeds in less footprint.
Then there’s the cost of obtaining the required TSA approval of the CBIS area. For conveyor-based installations, this means pushing baggage out of place for tracking to be tested. By comparison, securing TSA and ECAC approval for ICS can prove faster due to its near perfect tracking.
In addition, further conveyors will be needed in the CBIS area because bags screened in conveyor technologies have to remain separated on different lines after Level 1 screening due to the risk of loss of tracking. Whereas, the merging of bags on a single line after Level 1 screening is allowed for some ICS technologies due to the smart system configurations of CBRA workstations. This means baggage is not co-mingled after separation because each bag remains separated in its own individual tote and there is only one tote on each system element at a time.
For a deeper deeper understanding of what ICS technology is, download our white paper “Modern Individual Carrier Systems For Airport Baggage Handling”.
Then there’s the cost of installation. Conveyors of conventional systems must be assembled on site, which can be costly. But ICS is normally installed in plug and play modules which can prove more affordable.
When the costs for space, screening and installation are taken into consideration, the capital expenditure needed to implement ICS can often end up being more affordable than conventional systems.
The overall CAPEX needed to install a BHS can be reduced if the system’s footprint is minimised. ICS can occupy a smaller footprint than conveyor systems due to its compact design, higher processing capacity and therefore smaller amount of equipment.
There are a number of ways that ICS can save precious airport real estate.
In addition, by deploying ICS, footprint can be saved at the CBRA area, says baggage handling consultant Matthias Frenz, President at Logplan LLC. The ICS in Denver International Airport, for example, collects the ‘alarmed’ bags from different screening zones and transports them all to one, centralised area where the TSA conducts its intensified investigation.
|What is CBRA?|
|The Checked Baggage Resolution Area (CBRA) workstation is where non-cleared bags are opened and searched. A Transportation Security Officer (TSO) stands at the workstation and when a bag enters the workstation, an image of the bag appears on the monitor, allowing the TSO to know which area(s) of the bag need to be searched. Once the TSO has performed their search and the bag has been cleared, it is dispatched and sent to the sortation system for delivery to its outbound destination|
The CBRA workstation will consist of additional pieces of equipment added to the manual handling station element. These will consist of a storage cabinet under the element, two side tables that will be used for articles removed from the bag being searched and a back panel for mounting the screening monitors. The monitors will be attached to articulating arms that will allow the TSO to adjust the monitors to suit their personal preferences.
A BHS that occupies less footprint in a number of points throughout the baggage handling process, can result in significant CAPEX savings for an airport and contribute to making CAPEX more affordable in the long-term.
To calculate the cost-effectiveness of a BHS, an airport also needs to factor in its OPEX costs over the lifecycle of the system.
According to baggage handling consultant William Gibbs of Swanson Rink, this involves tabulating, on an annual basis, ongoing operations and maintenance costs for each BHS, such as the number of staff per shift, spare and replacement parts, OEM maintenance contract costs, electrical power consumption, costs to operate the inbound and outbound bag room and TSA operational costs.
In ICS, OPEX savings can be made due to certain factors inherent to the system:
Suppliers of modern BHS can contribute to minimising OPEX by providing O&M services and knowing the systems best.
Another area that an airport ought to consider in terms of cost-effectiveness is system reliability. When it comes to redundancy, for example, ICS can prove the less expensive option, because often there’s no need to build in redundancy when using this technology.
Consider these factors.
These figures come from a large hub airport where ICS has been operating for more than 10 years
Calculating the cost-effectiveness of different BHSs is a difficult art, given the myriad of varying factors that are always present in a BHS project and that each airport has its own individual requirements and specifications. However, if reliable baggage handling, 100 percent baggage tracking, overall lower maintenance and environmental costs, space and energy consumption are critical issues, then it may be that ICS technology emerges as being a more cost competitive option over the lifetime of the system.