1857. Estimating Life Cycle Cost

Paper

Abstract

Life Cycle Cost (LCC) is becoming an increasingly important element in the development and selection of aircraft programs. It is used by both industry and the customers to evaluate and select between alternatives. It is also used as a primary selection criteria for trade analysis since it is the only factor that combines all other elements of the program with a single value. Primary significance occurs between the application of resources in the aquisition phases and the resultant cost of operation over the life of the program. The models used to estimate the LCC must provide reasonable costs in which there is considerable confidence by both the contractor and the customer. It must be developed at a level which can provide significance between alternate configurations, systems and equipments and operational modes. LCC as presented in this paper is developed parametrically using hours and material dollars as independant variables and cost driving configuration and program factors as independant variables. These variables are incorporated into cost estimating relationships (CERs) using statistical multiple regression analysis. the CERs take the form of HOURS = C * V1^E1 * V2^E2 * V3^E3 * V4^E4 where V is the independant varible and E is the exponent. As will be seen, size is a predominant variable when considering a broad spectrum of aircraft types. Weight consistently provides the highest correlation coefficients as a proxy for size and is used throughout the model. The group level weight statement is generally used. With the increasing use of advancedmaterials, with their reduced weight, it must be remembered that the historical aircraft used in the databases are primarily metalic and therfore, since size (weight proxy) is a predominant variable the composite weights must be translated to the equivalent metalic weight. In developing LCC the interaction between the weight engineer and LCC analyst is critical. Both must totally understand the configuration and the LCC analyst must completely understand the weight statement since it tends to provide much of the configuration definition. Many of the elements of LCC must be adjusted for advanced materials and technologies and program peculiarities. These adjustments come from consultation with weight engineers and other technical personnel and require a close and continuing interface with them. The LCC estimates for future programs can be no better than the judgments related to weights and other advanced requirements. The LCC is continually reviewed and refined throughout the developement process, as is the configuration and the weight.