This dissertation's objective is to assist the Air Force (AF) in making difficult yet necessary choices regarding its aging fleets in order to fulfill national security objectives at lowest cost. Costs related to maintenance are a key component to the AF's decision-making process. In general, AF fleets are aging. This motivates the AF to want accurate maintenance cost forecasts. Forecasts of its current fleets and future replacement fleets are necessary. This dissertation will use commercial airline data to help the AF make these difficult choices.

The U.S. Air Force is grappling with the challenge of aging fleets and the optimal time to replace them. This monograph examines commercial aviation data to draw inferences about aging aircraft that may be relevant to the Air Force. It focuses on "aging effects"-i.e., how aircraft maintenance costs change as aircraft grow older. Although commercial aircraft clearly differ from military aircraft, the aging-effect estimates might help the Air Force to project changing maintenance costs over time.

RAND Project AIR FORCE'S long term interest in the topic of aging aircraft was rekindled in 1994, when we participated in the Air Force Scientific Advisory Board Summer Study that raised technical concerns about the viability of retaining certain aircraft past their original design lives. In 1997, the National Research Council's report on aging USAF aircraft reinforced those concerns. At that time, we initiated a modest Air Force sponsored research effort focused on emerging technical challenges for aircraft maintenance activities. Last summer we built on that technical background to examine the potential effects that aging aircraft would have on the costs of programmed depot maintenance (PDM) and engine support. The results of that work are documented in the annotated briefing that has been made available to the subcommittee. This year, we have broadened our review to cover other support and modernization activities where aircraft age may affect costs and readiness.

RAND Project AIR FORCE'S long term interest in the topic of aging aircraft was rekindled in 1994, when we participated in the Air Force Scientific Advisory Board Summer Study that raised technical concerns about the viability of retaining certain aircraft past their original design lives. In 1997, the National Research Council's report on aging USAF aircraft reinforced those concerns. At that time, we initiated a modest Air Force sponsored research effort focused on emerging technical challenges for aircraft maintenance activities. Last summer we built on that technical background to examine the potential effects that aging aircraft would have on the costs of programmed depot maintenance (PDM) and engine support. The results of that work are documented in the annotated briefing that has been made available to the subcommittee. This year, we have broadened our review to cover other support and modernization activities where aircraft age may affect costs and readiness.

As aircraft age, they generally become more expensive to operate. The rate at which those operating costs grow is important for setting operating budgets and for deciding when to replace aging systems. The faster costs grow as a system ages, the more funding will be needed to maintain existing aircraft and the sooner it becomes cost-effective to replace aging systems with new aircraft. The rate of cost growth associated with the aging of Air Force aircraft has increased in recent years. Growth in the total Air Force budget during the 2000s appears to explain a considerable portion of the higher estimated annual growth rates in operating costs per flying hour beyond the growth rate intrinsic to the aging of the fleet. In other words, because the Air Force had more resources available, it was able to increase spending on aircraft operation and maintenance.

Over the next 20 years, the further aging of already-old aircraft will introduce challenges and issues for aircraft operators. The technical challenges relate to structures, propulsion, and systems. The institutional challenges include limitations on independent verification of fleet status and future condition and on information needed for engineering analyses including risk assessment, and an overall scarcity of resources.