Aircraft Cost and Operational Cost

Figure 16.2 shows a typical high-subsonic civil aircraft cost at the 2000 price level in millions of dollars, reflecting the basic (i. e., lowest) aircraft cost. This graph is gen­erated from a few accurate industrial data that are kept commercial in confidence.

In general, exact aircraft cost data are not readily available and the overall accu­racy of the graph is not substantiated. The aircraft price varies for each sale depend­ing on the terms, conditions, and support involved. The values in the figure are crude but offer a sense for newly initiated readers of the expected cost of the aircraft class. Figure 4.5 can be used to obtain the relationship between the MTOW and the num­ber of passengers. The basic price of a midrange, 150-passenger class, high-subsonic turbofan aircraft is $47 million (2000 price level).

The aircraft MTOW reflects the range capability, which varies among types. Therefore, strictly speaking, cost factors should be based on the MEW. Readers should be able to compute the MEW from the data provided in Chapter 8. In gen­eral, larger aircraft have a longer range (see Figure 4.4b). The exception is when an aircraft with a low passenger load has a long-range mission (e. g., the Bombardier Global Express).

Typical cost fractions (related to aircraft cost) of various groups of civil aircraft components are listed in Table 16.1, providing preliminary information for




Cost fraction

Cost fraction


Aircraft empty-shell structures* Wing-shell structure

6 to 7%

Fuselage-shell structure

4 to 6%

Empennage-shell structure


Two-nacelle-shell structure**

part of the fuselage

Miscellaneous structures

0 to 1%


12 to 15%


Bought-out vendor items Two turbofan dry, bare engines**

25 to 30%

Mechanical systems***

5 to 8%


1 to 2%


30 to 40%


Avionics and electrical system

30 to 35%

30 to 35%


Final assembly to finish (labor-intensive)

12 to 15%

12 to 15%

(component subassembling, final assembling, equipping/installing, wiring,

plumbing, furnishing, finishing, testing)

* Individual component subassembly costs fraction.

** Single engine at lower cost fraction.

*** Includes control linkages, servos, and undercarriage. **** Cables, tubing, furnishing.

onsite at the manufacturing plant to provide general support and dialogue for all aspects of the product line. Civil aircraft OC includes two types, as follows:

1. DOC: These are the operational costs directly involved with a mission flown. Each operator has its own ground rules depending on criteria such as the coun­try, pay scales, management policies, and fuel prices. Standard ground rules are used for comparison of a similar class of product manufactured by differ­ent companies. In Europe, the AEA ground rules are accepted as the basis for comparison and provide a good indication of aircraft capability. A less expen­sive aircraft may not prove profitable in the long run if its OC is high.

2. IOC: The IOC breakdown in the United States is slightly different from Euro­pean standards. Airline operators have “other costs” that involve training, eval­uation, logistics support, special equipment, and ground-based resource man­agement, which are not directly related to the aircraft design and mission-sector operation; they are independent of the aircraft type. These are the total costs of the operator, termed life cycle cost (LCC). Unlike the DOC, there is no stan­dard for the LCC proposed by any established commercial-aircraft associations; each organization has its own ground rules to compute the LCC. Together with the DOC, they result in the total operating cost (TOC). Unlike military aircraft, the impact of other costs on the LCC in a commercial aircraft design appli­cation may be considered separately and then totaled to LCC – the DOC covers most of the design dependent costs. This book is concerned only with the DOC. The breakdown of LCC components is listed in Table 16.3. Most commercial aircraft operate beyond the design life span; hence disposal cost is considered as applicable.

The military uses the LCC rather than the DOC for the ownership of an aircraft in service. In general terms, it is the costs involved for the entire fleet from “cra­dle to grave,” including disposal. Military operations have no cash flowing back – there are no paying customers such as passengers and cargo handlers. Taxpayers bear the full costs of military design and operations. There was a need for LCC of military operations, which differ significantly from civil operations. Military air­craft OC ground rules are based on total support by the manufacturer for the entire operating lifespan, which can be extended by renewed contracts. A design to life­cycle cost (DTLCC) concept has been suggested but not yet standardized, which poses problems in providing a credible LCC comparison. Therfore, military aircraft operations deal with the LCC, although it has various levels of cost breakdowns, including aircraft – and sortie-related costs. Table 16.4 is an outline that categorizes the elements that affect the military aircraft LCC model.

Recently, the customer-driven civil aircraft market prefers the LCC estimation. Academics and researchers have suggested various types of LCC models, the prin­ciples of which are directed to cost management and cost control, providing advice on assigning responsibilities, effectiveness, and other administrative measures at the conceptual design stages in an IPPD environment.

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