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An Industrial perspective on Through-Life-Costing
November 2008
Estimating and Managing Through-Life-Costs
Presented by:
David [email protected]
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Welcome
to the world of Airbus
a few facts
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Passengers at heart. Airlines in mind.
Airbus’ achievements by the end of 2007 included
An annual turnover of €32.1 billion
A gross market share (units) of 51 %
Delivering 453 aircraft and selling 1,341 in 2007
Surpassing 8,000 aircraft ordered by 286 customers
Supporting 5,000 aircraft in service with 287 operators
Regularly achieving over 50% of large civil aircraft orders
and deliveries
Welcome to the world of Airbus
Data to end Dec 2007
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Evolution of the Airbus family
a world of innovation
9,175 orders
300 customers
5,366 delivered to date
453 delivered in 2007
Evolution of the Airbus family
Data to end Sept 2008
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European Roots with global outreach
a world of cultural diversity
1 global company
3 customer support centres
4 training centres
5 spares centres
9 engineering design centres
16 manufacturing sites
20 languages
24 hour customer support (365 days a year)50 flight simulators
more than 88 nationalities
160 offices
298 customers290 resident customer support managers
296 operators
More than 5,000 aircraft delivered
56,000 employees
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Though Life Costs
Through life costs
If we can’t afford it don’t build it?
David Gore
Airbus UK, 2008
When we mean to build, we first survey the plot, then we draw the model; and when we see the figure of the house, then we must rate the cost of the erection; which if we find outweighs ability, what do we then but draw the model in fewer offices, or at least desist to build at all?
William Shakespeare
Henry IV, Part 2,1.iii, 1598
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Through Life Cycle Costs, Why are they important ?
Environmental Impacts
Reductions in greenhouse gas emissions to prevent global warming
Reductions in Noise output
Airport congestion
Through life costs
Diminishing world resources
Fuel & commodity prices will only go up
Recycling & or disposal will become more important
Understanding the drivers for these is key
To enable Airbus to meet these challenges.
To enable Airbus to maintain its position.
Possibility that authorities will legislate to
achieve these, probably through
increased taxation.
Mitigating the Risk and realising the
opportunities associated with these will
become increasingly important.
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Because our Customers are asking for it
easyJet has become the first airline to outline the environmental requirements that must be met by the next generation of short-haul super-clean aircraft; and unveiled its design of what such an aircraft could look like for operation by 2015.
Dubbed the “easyJet ecoJet”, the aircraft would need to be 25% quieter and would emit 50% less CO2 and 75% less NOx than today’s newest aircraft (the 737 and A320 families of aircraft).
Rear-Mounted ‘open rotor’ engines for short haul flying due to their efficiency
A lower design cruise speed to reduce drag and a shorter design range to reduce weight
Noise reductions to come from a gearbox between the engine and the open rotor blades
Airframe to be made of advanced materials such as carbon fibre
Key features include:
Through life costs
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What does this mean ?
Evolution or Revolution: The history of Aircraft design has arguably been one of conservative evolution, however the problems addressed previously require a revolution.
Through life costs
The problem Airbus and other design professionals face is not so much a lack of ideas; ideas are historically what designers have been best at providing. The task facing designers today is in dealing with ‘limited resources’ in such a way that the optimum design is chosen.
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Understanding the Challenges
Market Requirements
High productivity Low cost of operation Superior reliability / maintainability Comfort / health driven cabin design Low cost of acquisition
Environmental Pressures
Low noise Reduced emissions Low manufacturing impact
Integration in the System Airport congestion Good airport compatibility
Through life costs
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What do we need to do.
We need to develop high levels of competence in the area of cost control and cost awareness, to enable our new design to meet these challenges, for example:-
Through life costs
Development costs and over runs effect Low cost of acquisition.
There may be restrictions on travel as resources run out, we need to address this now with our future designs, however these must be cost neutral.
We must be able to balance the benefits of a technology with respect to performance, against the cost to implement.
We must be able to balance the benefits of a technology with respect to operating cost, against the cost to implement.
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Addressing the challenge – current initiatives
Airbus participating in the multi partner Integrated Wing project.
This programme is of particular importance as it addresses the step changes called for by the The Aerospace Innovation and Growth Team (AeIGT) and the Advisory Council for Aeronautics in Europe (ACARE), set up to form partnerships between Government, Industry and Academia, under the heading of working together to ensure the competitiveness of the UK Aerospace Industry over the next twenty years.
Airbus, Design to Cost Department collaborating with Queens University and QinetiQ:
To create an integrated “Life Cycle Costing” model that will allow project partners to evaluate the impact of technologies being evaluated in the project.
How: By creating a Knowledge Landscape that provides a Life Cycle cost modelling framework, where competing technologies can be evaluated.
Resulting in the capability to trade off performance improvements against cost, and enable informed judgements to be made.
Through life costs
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Balance of Investments (illustration)
Active Health Monitoring
The use of smart sensors to predict the occurrence of an incident and reduce:
Unscheduled maintenance Increase utilisation
What cost would this technology bear:To maintain manufactures and airlines Internal Rate of Return?Without penalising the customer.
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Active Health Monitoring (Set Baseline)
Illustration 3:Show the impact on unscheduled maintenance hours when active Health Monitoring is deployed, then find what manufacturing cost increase the implementation of this technology could stand.
Find the level of profit the manufacturer has to charge to achieve an IRR of 15%):
Set the cost paid by passenger to enable the airline to achieve an IRR of 15%:
Specify reliabilty improvement 0 %
Apply predicted reliability improvement:
Find manufacturing cost delta that must be achieved to enable the airline to achieve an IRR of 15% with this technology deployed.
Development cost delta 0.0000 %
Manufacturing cost delta 0.0000 %
Maintenance cost delta 0.0000 %
Original number of Missions 41175Current number of Missions 41175
Utilisation increase 0.0000 %
Ticket Price £68.50IRR (manufacturer) 15.0 %
IRR (airline) 15.0 %
Step 1
Apply
Step 3
Step 2
0
1000
2000
3000
4000
5000
6000
1 3 5 7 9 11 13 15 17 19 21 23
Utilisation
Maintenance
Steps 1 & 2 Set the Manufacturers profit & notional ticket price to return predetermined Internal Rates of Return for Manufacturer & Airline.
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Active Health Monitoring (Set Technology)
Illustration 3:Show the impact on unscheduled maintenance hours when active Health Monitoring is deployed, then find what manufacturing cost increase the implementation of this technology could stand.
Find the level of profit the manufacturer has to charge to achieve an IRR of 15%):
Set the cost paid by passenger to enable the airline to achieve an IRR of 15%:
Specify reliabilty improvement 25 %
Apply predicted reliability improvement:
Find manufacturing cost delta that must be achieved to enable the airline to achieve an IRR of 15% with this technology deployed.
Development cost delta 2.4087 %
Manufacturing cost delta 3.0104 %
Maintenance cost delta -4.8131 %
Original number of Missions 41175Current number of Missions 42072
Utilisation increase 2.1785 %
Ticket Price £68.50IRR (manufacturer) 15.0 %
IRR (airline) 14.7 %
Step 1
Apply
Step 3
Step 2
0
1000
2000
3000
4000
5000
6000
1 3 5 7 9 11 13 15 17 19 21 23
Utilisation
Maintenance
The user may now specify and Apply a targeted improvement in reliability. It should be noted that as expected the number of missions has increased. However due to the cost increase to implement the Airlines IRR has reduced
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Active Health Monitoring (Find Cost)
Illustration 3:Show the impact on unscheduled maintenance hours when active Health Monitoring is deployed, then find what manufacturing cost increase the implementation of this technology could stand.
Find the level of profit the manufacturer has to charge to achieve an IRR of 15%):
Set the cost paid by passenger to enable the airline to achieve an IRR of 15%:
Specify reliabilty improvement 25 %
Apply predicted reliability improvement:
Find manufacturing cost delta that must be achieved to enable the airline to achieve an IRR of 15% with this technology deployed.
Development cost delta 2.1723 %
Manufacturing cost delta 1.4999 %
Maintenance cost delta -4.8131 %
Original number of Missions 41175Current number of Missions 42072
Utilisation increase 2.1785 %
Ticket Price £68.50IRR (manufacturer) 14.9 %
IRR (airline) 15.0 %
Step 1
Apply
Step 3
Step 2
0
1000
2000
3000
4000
5000
6000
1 3 5 7 9 11 13 15 17 19 21 23
Utilisation
Maintenance
Step 3 The model is now used to find the cost increase that this technology will bear to recover the Airlines IRR
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Future Initiatives & Conclusions
Airbus is leading the MDOW research and technology programme in collaboration with 15 leading British industrial and research companies to develop low-cost manufacturing methods that will enable high-volume wing manufacture for next generation aircraft.Future design processes will help reduce airline operating costs, airframe weight and maintenance.
The programme will build upon, develop and enhance current knowledge both in the materials and especially in enabling rapid and cost-effective manufacturing whilst maintaining their excellent weight performance and the eco-efficiency benefits these bring to the Through Life Cycle Model.
The Multi Disciplinary Optimised Wing (MDOW)
Through life costs
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and finally
to bring the presentation to a close
a short video that I hope you will find of interest:
and finally finally
what was the weight of the wing on the crane ?
24.6 t
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Thank you
for your attention
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© AIRBUS S.A.S. All rights reserved. Confidential and proprietary document.
This document and all information contained herein is the sole property of AIRBUS S.A.S.. No intellectual property rights are granted by the delivery of this document or the disclosure of its content. This document shall not be reproduced or disclosed to a third party without the express written consent of AIRBUS S.A.S. This document and its content shall not be used for any purpose other than that for which it is supplied.
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