Illustrates estimation of support investment costs and recurring operations and support costs through a Model for estimating Aircraft Cost of Ownership (MACO), which also provides a framework for future research. MACO is an outgrowth of an earlier evaluation of the strengths and weaknesses of the most widely used aircraft life cycle cost models. It combines new algorithms for major, maintenance-related costs with formulas drawn from existing models for other cost elements. MACO relates a full set of ownership cost elements to component level reliability and maintainability characteristics and to aircraft design, operations, logistics, and deployment parameters, although the MACO equations would have to be reorganized before they could be used to estimate costs according to the cost structure of the latest Cost Analysis Improvement Group guide. MACO computes resource quantities in units that can be related directly to Air Force programming categories, including base maintenance manning (by work center), depot manning, and recoverable spares inventory levels. Output and input parameters accommodate annual changes in system parameters and operating conditions such as component reliability and aircraft inventory size and activity rates.

This report illustrates estimates of support investment costs and recurring operations and support costs through a Model for estimating Aircraft Cost of Ownership (MACO), which also provides a framework for future research. MACO is an outgrowth of an earlier evaluation of the strengths and weaknesses of the most widely used aircraft life cycle cost models. It combines new algorithms for major, maintenance-related costs with formulas drawn from existing models for other cost elements. MACO relates a full set of ownership cost elements to component level reliability and maintainability characteristics and to aircraft design, operations, logistics, and deployment parameters, although the MACO equations would have to be reorganized before they could be used to estimate costs according to the cost structure of the latest Cost Analysis Improvement Group (CAIG) guide. MACO computes resource quantities in units that can be related directly to Air Force programming categories, including base maintenance manning (by work center), depot manning, and recoverable spares inventory levels. Output and input parameters accommodate annual changes in system parameters and operating conditions such as component reliability and aircraft inventory size and activity rates.

This research effort employs a System Dynamics methodology to model Air Force aircraft production break costs. The Air Force currently used the Anderlohr, Modified Anderlohr, and Retrograde methods for the estimation of aircraft production breaks. These methods offer little insight into the dynamic behavior of an aircraft production break. System Dynamics offers a unique way of capturing expert opinions in this area and dynamically presenting behaviors of an Air Force aircraft production line during a production break. Development of this model followed a four-step process of conceptualization, formulation, testing, and implementation. Five Air Force aircraft production break experts in were interviewed to formulate and validate the model. This research identified manpower turbulence and parts disruptions as the main cost drivers during the initial shutdown of an aircraft production line. During the break, there were minimal costs and no main costs drivers. During the restart of production, new requirements and the reconstitution of the workforce were found to be key cost drivers. Expert feedback indicates the System Dynamics model developed during this research will prove most valuable in policy formulation and in training of cost analysts.