This study formulates a dynamic programming model to determine the optimal facility purchase and replacement scheduling by considering facility renewal costs, aviation safety, passenger service level, and airport finance. The study constructs various cost functions on facility depreciation, operation, maintenance and delay for different facilities at different time stages according to passenger volume, facility reliability and utilization so as to reflect dynamic variations in those costs. Moreover, this study uses CKS international airport as an example to demonstrate the application of the model. The results indicate when the malfunction rate is higher than a certain level, such that the total maintenance and delay costs are higher than the total capital, depreciation and abandon costs to renew the facility, then the replacement must be done. This study provides the airport authority optimal strategic decisions on the purchase and replacement of various facilities in terms of quantities and timing.
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