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ASA Technical Memorandum 80196 CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS MILTON J. NEUBAUER, JR. National Aeronautics and Space Administration Langley Research Center Harnpton, Virginia 23665 https://ntrs.nasa.gov/search.jsp?R=19800010711 2020-05-27T10:35:42+00:00Z
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CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

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Page 1: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

ASA Technical Memorandum 80196

CQMPUTER PROGRAMS FOR ESTIMATING C I V I L AIRCRAFT ECONOMICS

MILTON J. NEUBAUER, JR.

National Aeronautics and Space Administration

Langley Research Center Harnpton, Virginia 23665

https://ntrs.nasa.gov/search.jsp?R=19800010711 2020-05-27T10:35:42+00:00Z

Page 2: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

SUMMARY

Computer programs were developed t o calculate a i r 1 ine direct operating cost, indirect operating cost, and return on investment. These programs provide a means f o r determining commercial a i rc raf t life-cycle cost and economic perfor- mance. des i gn programs. t o i l l u s t r a t e use of the programs.

The program codes can be easily incorporated into existing a i rc raf t A representat i ve w i de-body subsonic j e t ai r c r a f t was eval uated

INTRODUCTION

Those engaged in devel oping advanced a i rc raf t must eval uate techno1 ogy can- didates for possible incorporation i n t o the aircraf t . attempting t o understand such trades as: range versus payload; aerodynamic, propulsion, and structural interactions (impact on weight and fuel burned); and noise reduction versus performance change. A1 so c r i t i c a l , however, t o any deci- s i o n on whether o r not t o incorporate a suggested beneficial technological advance, i s knowledge of the cost o f developing the new technology and how i t will affect the a i r c r a f t ' s economic performance over i t s lifetime. The tech- nical tradeoffs made in preliminary a i rc raf t analysis are usually accomplished by complex computer programs which contain individual segments representing the various aeronautical di sci pl i nes b u t 1 ack a means of eval u a t i ng the a i rc raf t ' s economics. Airframe manufacturers and others have devel oped computer programs t o perform these calculations; however, these programs are not available in the open l i terature . In an effor t t o f i l l t h i s need, two computer programs were developed. These programs, while not to ta l ly representative of the actual costs which an a i r l i ne would incur, are sufficient t o establish the overall impact which a proposed advanced technology might have on operating cost. This report describes a program t h a t calculates Direct Operating Cost (DOC) (and i t s sen- s i t i v i t y to a number o f parameters), and a l so a program which calculates Return on Investment (ROI). ( D O C ) and Indirect Operating Cost (IOC) of the airplane, and also on the dis- counted cash flow concept. sens i t iv i ty t o var ious parameters i s suff ic ient for many advanced a i rc raf t eva- luations (ref. 1). An a i r l i ne ' s return on investment, however, i s the final and most important measure o f the efficiency of a commercial a i rc raf t .

This i s usually done by

The ROI program i s based on the Direct Operating Cost

Knowledge of the direct operating cost and i t s

Computer codes are compatible w i t h the CDC 6600 computer system. The DOC model i s based on the standard Air Transportation Association model (ref. 2) using 1976 cost coefficients (obtained from the Boeing Commercial Airplane Company). The indirect opera t ing cost model i s based on a model obtained from

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the Lockheed-Calfornia Company ref. 3) using 1976 cost data. Sample calculations are provided t o i l f ustrate use of the program.

DESCRIPTION OF COMPUTER PROGRAMS

Direct Operati ng Cost Program

The DOC program determines costs related t o the operation of a subsonic a i rc raf t in making a specific f l ight . following elements: f l i gh t operations (which includes crew, fuel, and insurance costs) material costs for the airframe and engine, and maintenance overhead), and depreciation cost.

Direct Operating Cost is made up of the

maintenance (which includes labor costs for the airframe and engine,

Appendix A-1 presents the symbol definit ions for bo th the i n p u t requirements and the o u t p u t of the program. Table I shows the equation form used for each cost element and Table I1 i l l u s t r a t e s the parameters t h a t affect these costs. Values for cost coefficients C1, c2, c and C7 are given i n the program l i s t - ing presented in Appendix A-2. The cos? coefficient subscript number refers t o the order i n which the coefficient f i r s t appears in the computer program.

crew size may be e i ther two- man or three-man; engine type may be ei ther high bypass ra t io o r low bypass ra t io ; the airplane may be e i ther new or used; and e i ther a domestic o r inter- national f l i g h t may be specified (see Appendix A-2).

Four options are included in the DOC program:

The fuel cost includes a l l gas and oil burned i n making the f l igh t plus an allowance for nonrevenue producing f l ights . Depreciation i s based on the s t ra ight- l ine method and i s determined by prorating the price paid for the a i r c ra f t (plus an allowance for airframe and engine spares) over a baseline l i fe t ime of .14 years. A printout o f a sample run i s shown in Appendix A-3. Calculations are i n i t i a l l y made based on the a i r c r a f t ' s direct operating cost per mile. The printout also provides direct operating costs given in terms of DOC per block hour, DOC per f l igh t hour, DOC per seat s ta tu te mile, and DOC per passenger s ta tu te mile.

The program a l s o calculates the effect of specific percentage increases in each cost element on the DOC. For example, i n i t i a l l y the DOC i s found for a base fuel price. The DOC i s then determined for a 100 ( Z F ) , 200 ( 3 F ) , and 300 ( 4 F ) percent increase over the base fuel price. la ted are increases of 25, 50, 75, and 100 percent in maintenance ( M A ) , crew ( C R ) , and airplane investment costs ( A P ) , as well as the effect of various depreciation periods (DP) from 10 t o 15 years.

Other cost s ens i t i v i t i e s calcu-

Return on Investment Program

The Return on Investment program calculates the ra t io of airline profit t o

Appendix B - 1 gives the input and output definit ions, Appendix 6-2 a i r l i n e investment generated by the operation of the a i rc raf t d u r i n g i t s ent i re l i f e cycle. presents the program l i s t ings , and Appendix B-3 shows a sample case p r i n t o u t .

2

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I n addition t o the direct operating cost (calculated in the same manner as a1 ready di scussed) discounted cash flow method t o determine the ROI.

the program cal cul ates i ndi rect operating cost and uses a

The indirect operating cost section of the Return on Investment program determines costs indirectly a t t r ibutable t o the a i r c r a f t ' s operation. IOC i s found by summing the following costs (see Table 1x1): systems, local, a i rc raf t control, cabin attendant, food, passenger handl i ng, cargo handl i ng, other passenger service, freight commissions and advertising, and general and admi- n is t ra t ive. Labor, property, equipment, and s ta t ion maintenance cost (from ground f a c i l i t i e s ) is included in the systems cost. Local cost includes landing fees and servicing. Aircraft control cost includes al l a i rc raf t handl ing charges. Cabin attendant cost refers t o the stewardesses. In the code, one stewardess i s assigned for each 40 seats. The cost of food covers a l l food and refreshments served without charge t o passengers. Passenger handling cost i s actually the cost of handling the passenger's baggage. resul ts from handl i ng mail, f re i g h t , and express cargo. Other passenger service cost encompasses a l l ac t iv i t ies re1 ated t o passenger comfort, safety, and con- venience. Freight commissions and advertising cost i s the expense associated with creating a public preference for an individual a i r carr ier , stimulating a i r t rave l , and providing timetables. The general and administrative cost repre- sents cost of an overall corporate nature. Individual parameters which affect each IOC cost element are shown i n Table IV. The IOC cost model assumes t h a t some individual costs are dependent on the airplane 's direct operating cost. the program printout i l lus t ra ted i n Appendix 6-3, IOC is presented as follows: IOC per block hour, IOC per f l igh t h o u r , IOC per seat mile, IOC per passenger mile, and IOC per a i r c ra f t s ta tu te mile.

Cargo handling cost

In

Table V i l l u s t r a t e s the form of the equations used t o calculate ROI and Table VI presents the parameters which affect i t s calculation. parameters are cal cul ated and 1 isted i n the program printout (Appendix 6-3) : operating cost, revenue, cost of depreciation, profit before t a x and interest , book value of a i r c ra f t , in terest , income t a x , p r o f i t a f te r t a x and interest , present value factor, and discounted cash flow.

The following

Each of these parameters i s determined for each year of the a i r c r a f t ' s l i f e . Nonies brought i n by passenger fares and cargo transportation are calculated u s i n g 1976 yields and are included i n the revenue data. Direct and indirect operating costs are summed and included under operating costs. nue and operating costs can be accounted fo r by specifying the inflation rate expected i n future years (see ROI i n p u t section, Appendix 6-1).

Growth in reve-

Cost of depreciation is discussed in the direct operating cost section. Book value i s the value of the a i rc raf t d u r i n g a specific year of the a i r c ra f t ' s 1 i f e a f te r subtracting the accumul ated depreciation expense from the original airplane price. The program assumes that the investment in the a i rc raf t is made with borrowed funds. Interest cost i s based on a 10-percent interest rate; however, any desired interest rate can be i n p u t . The balance of the a i rc raf t loan i s amortized by specifying that a *sum of money equal t o the yearly depre- ciation expense is used t o repay money borrowed t o purchase the aircraf t . means t h a t the amount of borrowed money outstanding a t any p o i n t in time is also equal t o the book value of the ai rcraf t .

T h i s

Income remaining af te r taxes are paid

3

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i s referred t o as "profit a f t e r t a x and interest" and th i s parameter varies for each year of the a i r c r a f t ' s l i f e . Present value calculations are made by taking the profit a f t e r t a x and interest and discounting th i s profit a t an assumed rate i n order t o balance the remaining l i f e cycle income (cash flow in) against the original cash investment (cash flow ou t ) . Cash inflow i s determined for each year of the a i r c r a f t ' s l i f e , and an interat ive calculation procedure i s employed using progressively larger numbers to find the actual discount rate t h a t will balance the discounted cash flow in against the original cash investment. The discount rate t h a t causes a l l cash flows t o balance i s the a i r l i n e ' s return on investment and i s also known as the "internal rate of return."

The present value factor used in the discount cash flow method must always have a value between zero and one. Therefore, i f the sum of the prof i t a f t e r taxes and interest i s less than the original cash investment, the cash flows cannot be balanced and an ROI (which could be negative) cannot be calculated. I n order t o allow f o r the calculation of negative ROI values, the program calcu- l a t e s a constant t h a t i s added t o each year 's profit a f te r taxes and interest . Application of this constant assures a positive value for the difference between the original cash investment and the adjusted p r o f i t a f te r taxes and interest . A negative sign i s then applied t o the ROI.

To l imit the calculations t o practical values of ROI, the program calculates i t within a r ange of +lo0 percent. equal 100 percent, thF user i s so advised in the printout.

Should the absolute value of ROI exceed or

A summary i l lus t ra t ion of the many factors which affect a commercial airplane's R O I i s given i n Table VI.

SAMPLE CALCULATION

A subsonic wide-body commercial j e t transport a i rc raf t flying w i t h a 55-percent passenger load factor over a distance of 8336 kilometers (5180 st.mi.) i s used t o i l l u s t r a t e the information which can be obtained from these economic computer programs. Tables VI1 and VII I . A zero inflation rate i s specified for both revenue and operating cost. negl i g i bl e.

I n p u t values for the sample case are given i n

Freight and cargo loads are considered t o be essentially

Figure 1 presents the effect of increases i n crew, maintenance, a i rc raf t cost , and fuel cost on the baseline DOC. Increases in fuel cost have the greatest effect on DOC while increases in a i rc raf t cost have about the same effect as does an increase i n maintenanee cost. An increase i n crew cost has the smallest effect. All calculations in figure 1 (and figs. 3-6) assume the a i r c ra f t i s depreciated over a 14-year periodl.

Figure 2 shows the effect of various depreciation time periods (10 t o 15 years) on DOC.

Figure 3 i l l u s t r a t e s the relative levels of DOC, IOC, in terest , income t a x , Due t o the assumption of zero and profit for each year of the a i r c r a f t ' s l i f e .

inf la t ion rate, DOC and IOC are constant over the a i r c ra f t ' s l i fe .

4

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Figure 4 shows the relative importance of each cost element i n the DOC and the IOC over the a i r c r a f t ' s 14-year l i f e cycle. f re ight commission, airplane control, and cargo hand1 ing costs are taken as negligible. do l la r will be used over i t s lifetime.

In t h i s sample case, the

The figure also includes a summary of where the a i r l i n e ' s revenue

Figure 5 presents the cash flow generated by the a i r c ra f t i n each year of i t s l i f e (discounted t o i t s present value) for various load factors. factors near the breakeven point (such as 50 percent), l i t t l e variation in discounted cash flow occurs. The most profitable case, of course, i s for a 100 percent load factor, for which a very high positive discounted cash flow occurs early in the a i r c r a f t ' s l i f e . In l a t e r years, when positive cash flow levels are less important, the discounted cash flow tends t o approach zero. A large loss occurs when the a i rc raf t i s operated with a 30-percent load factor.

For load

The variation of return on investment w i t h load factor i s presented in figure 6. Changes in the slope of the curve result from the fac t that income t a x i s paid only i n those years i n which a profit i s made. above about 50-percent, a positive ROI results. In such instances, income taxes a re paid and a profit i s realized i n each year of the a i r c r a f t ' s l i f e . Below a load factor of a b o u t 30 percent, a loss i s encountered each year, no income t a x i s ever paid, and the discounted cash flow ROI is always negative. Between load factors of a b o u t 50 percent and 30 percent, a p r o f i t may occur i n some years of the a i r c ra f t ' s l i f e b u t i t will not be suff ic ient t o return the investment made in the a i rc raf t .

For load factors

CONCLUDING REMARKS

Computer programs which cal cul a te air1 i ne d i rect operat i ng cost, i ndi rect operating cost, and return on investment were developed t o provide a computer model for determining commercial a i rc raf t life-cycle cost and economic perfor- mance. These codes can be easily incorporated into existing a i r c ra f t design programs. A representative wide-body subsonic j e t a i rc raf t was evaluated t o i l l u s t r a t e use of the programs.

National Aeronautics & Space Admi ni s t ration Langley Research Center Hampton, Virginia 23665 November 9, 1979

5

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REFERENCES

1. Maddalon, D. V.; and Wagner, R. D.: Energy and Economic Tradeoffs f o r Advanced Technology Subsonic A i r c r a f t . NASA TM X 72833, April 1976.

2. Standard Method of Estimating Comparative Direct Operating Costs of Turbine Powered Transport Airplanes. America, December 1967.

Air Transport Associat ion o f

3. I n d i r e c t Operating Cost. Lockheed-California Company Report LW 70-500R, May 1970. I n d i r e c t Operating Expense Method Report COA 2061, J u l y 1974.

A1 so see r e v i s i o n s t o 1969 Lockheed-California Company,

6

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TABLE VI1.- DIRECT OPERATING COST SAMPLE CALCULATION

Input

Block distance, km ( s t . m i .)

Maximum takeoff gross weight, kg (lbm)

Airframe weight, kg (lbm)

Block fue l , kg ( lbm)

Block time, hours

Cruise speed, km/hour (st . mi ./hour)

Number of seats

Tota l th rus t , N ( l b f )

Number of engines

Time in ground maneuver, hours

Passenger load factor , percent

Cost o f gas $ / I i t e r ($/gal 1 on)

Cost of o i l ., $ / l i t e r ($/gallon)

Oil burn ra te , kg/hours ( l b / h o u r )

Labor ra te , $/manhour

Depreciation period , years

Insurance ra te , percent

Spares, percent o f airplane purchase price

engines airframe

Purchase price of airframe, $

Purchase price of one engine, $

Revenue inf la t ion ra te

Total operating cost inflation r a t e

Program Code

REQRNGS

WGROSS

BEWMENG

FUELBL

TBLOCK

SPEEDE

N S

VCJ

ENGNO

TGNDMAN

LOADF

CSTGASB

CSTOI LB

OILBR

LABRATE

DEPYR

INSR

SPARENG SPAREAF

CSTAF

CSTIENG

G R E V

GCSTOP

8,336

352,063

158,664

112,588

9.77

1,043

385

800,680

4

0.25

55

0.1

4.0

0.061

9

14

1

30 6

27,500,000

1,760,000

0

0

Value

( 5,180)

[ 776,165)

(349,794)

(248,215)

(563)

(180,000)

(0.37)

(15.0)

(0.135)

( 1 Metric 13

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Input

Crew size, men

A i rpl ane condition

Engine type

Route structure

TABLE VII. (Continued)

Program Code

BC

BN

BE

B

Val ue

3

New

H i Bypass

International

( ) Metric

44

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TABLE VI 1 I . - RETURN ON I NY ESTMENT SAMPLE CALCULATION

Input Program Code Val ue

First class seats (15% o f total sea ts ) SEATSIC 58

Tourist class seats (85% of total seats) SEATSTC 327

Weight of f re ight , kg (lbm) WFREIGT .045 (0.1)

Weight of cargo, kg ( lbm) WCARGO .045 (0.1)

Cabin attendants (one per 40 seats) NC ABATT 10

Yield from f i r s t class passengers, $/pass. km ($/pass. s t . mile)

Yield from tourist passengers, &/pass. km ($/pass. s t . mile)

YLDIC 5.7 (9.1)

YLDTC 4.3 (7.0)

Yield from cargo, $/ton km (&/ ton s t . mile)

Tax rate, percent TAXR 48.0

Y LDCARG 16.8 (27.0)

Interest ra te , percent I NTR 10

( ) metric

15

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0 25 50 75 100

Cost increase, percent Figure 1.- Effect of cost increases on direct operating cost .

16

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1.15

1.10

1.05

1 .oo 10 11 12 13 14 15

1 .oo I I I I I 10 11 12 13 14 15

Years

Figure 2 . - Effect of variable depreciation period on d i rec t operating cost .

17

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35

30

25

20

1 5

10

5

Profi t a f t e r t ax and in t e re s t

‘-s Tax

Interest

Indirect operating cost

Direct operating cost

0 2 4 6 8

Years

Figure 3.- Cash flow versus a i r c r a f t year of l i fe .

78

Page 20: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

L a 7

c 0 W

t H

L aJ > 0

0 V

aJ > c, a aJ L cc 0

S 0 L)

*r

c

c c M

i

d

.. LLI I- O z

19

Page 21: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

100% load f a c t o r -

- 50% load

30% load /- f a c t o r

f a c t o r

I I I I 0 4 8 12 16

Years

Figure 5.- Discounted cash f l o w v a r i a t i o n w i t h time f o r var ious passenger load f a c t o r s .

20

Page 22: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

c, S a, V L a, e

-I-, s ar E c, u) a, > s

c 0

S L 3 c, ar d

n

H

60

40

20

0

- 20

-40

-60

- 80 0

1 I I i i

20 40 60 80

Passenger load factor, percent

100

Figure 6.- Return on Investment as a function of passenger load factor.

21

Page 23: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

APPENDIX A-1. - DIRECT OPERATING COST SENSIT IV ITY PROGRAM

B

BC

BE

BEWMENG

BN

CSTAF

CSTGASB

CSTOI LB

C S T l E NG

DEPYR

ENGNO

FUELBL

INSR

LABRATE

LGADF

NS

G I L B R

REQRNGS

SPAREAF

SPARENG

Input

input for route type ( I for domestic f l i g h t ; 2 for international f 1 i g h t )

i n p u t for crew costs (2 for two-man crew; 3 for three-man crew)

input fo r engine costs ( 2 for low bypass engine; 5 for h i g h bypass engine)

basic empty structural weight minus engine weight

i n p u t for airplane costs (1 for used airplane; 10 for new airplane)

cost of airframe = cost of airplane less engines, $

cost of gas a t base price, $/gallon

cost of o i l a t base price, $/gallon

cost of one engine, $

number of years t o depreciate a i r c ra f t

number of engines

block fue l , pounds

insurance ra te , percent

labor ra te , $/hour

passenger load factor, percent

number of seats

o i l burn ra te , pounds/hour/engine

biock distance, miles

spare ai rframes , percent o f a i r c ra f t purchase price

spare engines, percent of a i r c ra f t purchase price

22

Page 24: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

S P E E D E

TBLOCK

TGNDMAN

V C J

WGROSS

A P

CR

C S T A P

CSTCREW

C S T D E P

CSTENG

C S T F L Y O

C S T F U E L

C S T I N S

C S T L A B F

CSTLENG

CSTMAF

CSTMAIN

CSTMAOH

CSTMENG

DOCAP

DOCBL

DOCFH

DOCR

DOCS

t rue cruise airspeed, mi 1 es/hour

block time, hours

time for ground maneuver, hours

maximum cer t i f ied takeoff thrust, pounds

maximum takeoff gross weight, pounds

o u t p u t

airplane price sens i t iv i ty

crew cost sensi t ivi ty

cost o f airplane, $

cost o f crew, $/airplane mile

cost of depreciation, $/airplane mile

cost of engines, $

cost of flying operations, $/ai rpl ane m i l e

cost of fuel , $/airplane mile

cost of insurance, $/airplane m i 1 e

cost of labor for airframe maintenance, $/mile

cost of labor for engine maintenance, $/mile

cost of material for airframe maintenance, $/mile

to ta l cost of maintenance, $/mile

cost of maintenance burden, $/mi l e

cost of material for engine maintenance, $/mile

d i rec t operating cost of ai rpl ane I $/mi l e

d i rec t operating cost , $/block hour

d i rect operating cost , $/fl i g h t hour

d i rec t operating cost , cents/revenue passenger mile

d i r ec t operating cost, cents/seat m i l e

23

Page 25: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

DP

F

LABAFFC

LABAFFH

LABENFC

LAB EN FH

MA

MATAF FC

MAT A F F H

MATENFC

MAT EN FH

S PEE DB L

TRCRU I S E

TFLIGHT

UTI L

depreciation period sensitivity, years

fuel cost sensitivity

1 abor for airframe maintenance, man-hours/flight cycle

labor for airframe maintenance, man-hours/flight hour

1 abor for engine maintenance, man-hours/flight cycle

1 abor for engine maintenance, man-hourslflight hour

maintenance cost sensitivity

material cost for airframe maintenance, $/flight cycle

material cost for airframe maintenance, $/flight hour

material cost for engine maintenance, $/flight cycle

material cos t for engine maintenance, $/flight hour

block speed, miles/hour

time in cruise, hours

flight time, hours

annual utilization time, hourslyear

24

Page 26: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

- t 3

t- 5) 0 II 9 AI a I-

6 3

z I1 'I, w - n o U O I-4

+&

a C

n w

a -

I LL 7 w m Q J

u iL LL

I-

5

T iL IL U I- 4 H

m

a a c

\

I- 7

I N 0

\

W

r 4 2

0

I-

J 2 V J

V

u 0 c

w

a

a

a I- d

9 1c 3

I I I I I I t I I

I I I

1 I I I I I

4

L n N

I-

w Lri 3

I/? VI 0 u W

r H

LL LC 0

L . , ^ A -

;rJ W

in 0 ln r(

IX I \ In W -I

I

W

U

,,

N E 4 v r(

r- V

0 R'

0 m

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w e 4 n

cc) N . 3\ e m A . 0 m \ 4 C \ 0 cc

* * * * * * * * * * * * 0 4 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 7 * 6 0 * u tt- * u * w * E 4 * v , 0 1 * o * u a t -

s i 0 * et- * t L * a * r * u * z- * n * a * * * * * * * * * * 9 4 3 4 t * * * * * * * * * 911 * * * * * * * * * * * * * * * * * * 311 e 4 * *

* a

N I1 u .TI

z w X V

2

3:

N

a

* m I1 u X

3 W cc u z r a

d II z m W 2 a -I a a a - 0 W m 3

c

0

I1 2 T

W z 4 -I 1 X

U

3 w 2

4

H

* 0 * * * * * * * * * * * * * * * * * * * * * * 0 * 9 * * d * * * 4 t 4

* * * * 4 * 4 * * * 9 * * f 4 Q * 3 * 4 * * 9 * * * * * * 0 * 0: * * 4 * 4 t * 0 * f

t c J

I)

t

+.I

Y

CI

a n E 0 V

T a cr (I) 0 CI: a lr c o 00 c LL + z \ \

tJ- <3 L w z 4 (3 UJUl e a x I- a u za e w m v , v II II CK aLL

n a

z w v ) I 0

. .

w z a a L>U

w a6 c a Q

a

13 z W

W 2 C

X 0 c z 0 s a U. 0 + a-

s Ln e n ul 9

LI! 9

0 I-

W N

Page 28: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

m

W (s 4 CL

X N

01 4.

m

. H

0 m \ 4 0 \ 0 o?

111 n

.+ II I-

0 n

.+ r- \ .t ,-

a 7

LY

z U i? 0 a a

a

a

V 0 3

LL 0

r7 0

+ Q J 3 V -J

V I 1 I I I

I I

I I I I I I 1 I I I I

n

a

C C O C 0 0 0 0 0 0 0 0 . . a .

\

v V 0 J L13 c * a . + a . o a c \ v 0

cf ir 9 9 J a e a

Rl 3

.-I * - Y V

In so

0 m

0 0 r(

m 0 In 0 .-J .-# 4 A 4

0 N d

m N 4

Page 29: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

X

rn .t

m 9

r( . 0 m \

0 \ 0

-.I

m

n ..r * + IC

.f-

z I- LL

4

I1 c C a

3 (c

\

I-

W 2 4 E

z X c" c

a

a a

- - o . O O Q I A -4 .*a .A ' O O Q O * * * \ O O C 9 Z Q w--.

. Z W G Z U V

A n

f

-1 cr -1 w 3 LL

Y U 0 -I

L

*

n a mt- w 2-2 v,

0 m d

In m .-i

c 9 - h

c I-

O c? - + w J

cr t

w

Y

LL

a n - u

Page 30: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

n

lL! 3

n a

a N

c m ul N

m 3) s + I-

e 2 c !A

.

3 .f

e o I1 I-

oo[Y * .>O -lea I- ll l l w J L n O O NN XC3

M

9 LL .I

m 9 LL

0 I a CJ

e

a in

n LL

8.

X Ln

"1

s LL

0

c

c

t CI u 3 w LI 'rl . . *

0 m 0 I-

O I- r(

0 J 0 I-

0 N 0 I-

0 0 N

Page 31: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

UJ c s

Q a

. m 3

m ,-I . 0 m \ M

0 \ 0 a?

in P t + r- * 2 I- LL

.

-4 II I-

0 a

e h \ 3 i-

e z Lz

r Q Lz 0 0 CT

a

a

m * LL

II k: V 0 -I m I-

X cc X M

N

a- LL

t

0.

II

* W -I

F. e

E. W D a-4

W 6 , - *

11

w

z n u r avi

D W

e+ n u v * w - a x Irl - a N

.r 4 . 0 -4 W II * II W z W J I-

.v: * v - * w - A X

- v,o- a * * a I -uoc z * * z [ L x x x D W N O L L L L

rrN

m m a a

0 N N

4 I1 w +LL * O C I I u ln 3 4 u w - 4 x o - u x x I- MY) m - - u t 4 - r o XCTA m c w

LL d - 4

N 4

- m a

* a

ln 0 N m N N

L

& . -4 4

W

II I LL z W

J I P

X r- 3

N

W

I1

LL LL

c r I m X X

3

c

.n a

c .. -4 .. r

a a

9.

. . 4 4

w - W I L L .**e- ll

LL L 4

r

n a -I

I CP

I- Q r Lz 0 LL

0 .n

v

N 11 -4u I I ) !A * L L

I C 0

Z J w C I

H-

- r xa: OOO

L

r-

II a L a

a m r t m a

-4

in

(I) m N

m a - a a a x u s a r u a -I x z J E roo 4 0 m o 2

LL LL L L W - 4 - 4 4

0 3 0.l

m W u 7 W

- c T N U II LL ( r w - c c a x a

Page 32: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

C 0 +

0 + W

w c rt 9 IC . II I 0

- -4 3 0 . II

4 V 0

a

n

P- 0 + w 0 9 IC z

I t L" I w t m V

d

G Q ~ m m m U x L L l l V

m o m r - c r UIGCOI w n 0' uIC o x r o o 0 . . . . E

n m ~ 4 4 ~

1 1 I a m a rvina 0 or( 0

I O 0 t o L O *a 8 3 N K t O N

rl 0 + w r- 0 N rl

0 0 + w IC

0 m m

0

m W -1 U r

I1

w e Ln V

a n

mrr, 0 0 + + w w ICG

a 0

IC C + W 0 3 0 IC .

m 0 0 + w * N In z

IC N s

W I- 3 t- I- Ln

a rl 0 + W r- m m z

0

l l -I W c 3

0 0 + w 0 r- d R:

11 m z. U

W VI Q 0 t- m

u * 3 W

V

7

F

fU

a

a

9 0 + w N m ;f N .

.-I 0 + W .-I 0 IC N .

e 0 + J

t- (r; V

w 0 Ln b N . 11 LL d t Ln u

rl 0 + W IC 9 9 m .

0 0 + ul P- rc 0 d .

<z 0

II -J w 3 LL

z z. -l

a

c I- W 3

u U

t- Ltl 0

-s 0 +

t l 0 >

w u,

-1 L t L m u

0 0 a

0 r- IC

T.

\D 0 + W N \o IC yc

It tr Ltl C

0 3 + w r(

m .-l m * ll 3 lLi cc V

a: 0 + w 0 Ln 3 n

I I a a t I/? V

Ltl u

I m' Q

0 0 + W

I? rn n

.-.I

If LL s a -f

x m Z W n n =c

- U W a t+t -

c m z 0 u

[L W 3

I- m V

0 + w In N -t m

I- d -I 3 u J

V

i, 0 c,

a

a a I-

\D (s m -t

z 0

I- U

a Y V w iT

w lcli

a

m .-l I-

v1 V 0

m Ln

W J

z a W a (ct

M

d

w z c9 z W

Y It -1 9 u 0 n

9 0 + W c 0 a d .

It -r ix 0 w W a v,

w r

LL z

a a

U

a . I t 7 u 5 LI

V 2

2 W I- z

z.

a

Y a

(Li 2

-1

cc

a

Y

. G W

m d V

0 n

t -1 L

L. 0

a II

ln 2 r)

LL 0

c \p 0 'V

It 1 m

4 0

Page 33: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

DEPART

IR

K1

K2

K3

K4

K5

K6

K7

&3

K9

KO

M CAG ATT

SEATS I C

SEATSTC

WCARGO

WFRE I GHT

APCONT

CABATT

APPENDIX B-1" - RETURN ON INVESTMENT PROGRAM

Indirect Operating Cost Section

Input

number of departures

inf la t ion rate , percent

system cost coefficient

local cost coefficient

airplane control cost coefficient

cabin attendant cost coefficient

food and beverage cost coefficient

passenger-handling cost coefficient

cargo-handling cost coefficient

other passenger service cost coefficient

freight commission cost coefficient

general and administrative cost coefficient

number of cabin attendants

number of f i r s t -c lass seats

number of tourist-class seats

weight o f cargo, pounds

weight of f re ight , pounds

o u t p u t

airplane control cost, $/trip

cabin attendant cost, $/trip

*Also see Appendix A-1.

32

Page 34: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

FGTCOM

FOOD

GENADM

I oc I OCAP

I O C B L

I O C F H

I OCR

I ocs LOCAL

OTHSER

PAXHAN

SYSTEM

TOC

DCFROI

DCSH F LO

I NTR

TAXR

YLDCARG

Y LDTC

YLDIC

cargo-handling cost , $ / t r ip

f re ight commission cost , $/trip

food and beverage cost , $ / t r ip

general and administrative cost , $/trip

indirect operating cost., $ / t r ip

i nd i rec t operating cost o f ai rpl ane , $ / m i 1 e

indirect operating cost , $/block hour

indirect operating cost , $ / f l ight hour

indirect operating cos ts $/passenger mile

indirect operating cost , $/seat mile

local costs, $/trip

other passenger service cost , $/trip

passenger-hand1 i n g cost , $/trip

system expense, $ / t r ip

total operating cost (direct and ind i rec t ) , $/trip

Return on Investment Section

Input

internal ra te of return on investment, percent

d i scounted cash flow , dol 1 ars

in te res t ra te , percent

tax ra te , percent

yield from cargo, cents/ton-mile

yield from tourist seats, cents/passenger mile

yield from first class passengers , cents/passenger m i l e

33

Page 35: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

BOOK

C S T O P

CSTOPMD

I NTREST

NET

P ROATA I

PROBTAI

REV

TAX

o u t p u t

or i ginal purchase price minus accumul ated depreci a t i on , $

cost of operating, $/year

cost of operating minus depreciation , $/year

i n t e re s t , $/year

net dol lar inflow and outlfow over the l i f e of a i r c r a f t

p rof i t a f t e r taxes and in t e re s t , $/year

p ro f i t before taxes and in te res t , $/year

revenue, $/year

tax, $/year

34

Page 36: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

C m

a - W O n m I-- V)x o a VI-

-

c 1 * - - N O - - m

-u- I - t -c . l 3 3 3 4 : n o t - i - r ~ r n o a-a- I) ..om IIOaC. Q a *In ,Lt-l-w a. - C I i- a - t o n - a + o c ~ v l m aacra

I - - * - -

= 3 r w - z m i - 0 H - Z C It O H I A n o - u

Z 3

t-

-I 1 V A

u u 0 53

u

a

a

a I- G

5 f- * f I I I 1

t I : I I

I I I s I 1 I

r(

t

a iL1 3

tn Ln 0 X W

r I 4

v) 53 z 2 0 a

tn W

I- z w V a W a - (31 C I- V

LL a

rg m

.-.I In 0 m .-I .-I

0 (u

0 m

0 *

Page 37: CQMPUTER PROGRAMS FOR ESTIMATING CIVIL AIRCRAFT ECONOMICS€¦ · balance the discounted cash flow in against the original cash investment. The discount rate that causes all cash

?L1 (3 a a

In m . .

S N \ 4 0 \ 0 rn

m m .s t-

.s z c LL

4 11 I- a 0

* t- \ e t-

(3 2

n z a a C? 0 E

a

a

z r \ X I3 0 I \ v)

a

Y

irl V 2 a z W c 2 U 4 I

a 0 LL

m W a a ln

a

a 0 IL

z t W

v,

W

a

n e ffl 3 r t-

T I-

W 0

lx

a

+I

a w Y; a 1

m 0 z 3 0 a - t X m d 3

W 5

x

a a a lL

U U

ln D J W

>- I- I (3

W 3

W z c z IAJ

U

U

U

0 0 * * * * * * * * * * * * 4 6 * * * * 0 * * * * * * * * * * * * * * * 4 4 * * * * * * * * 0 3 * * * * 4 0 * * * 7 * o * I + * t - * u * w o m * l n * I * o * u * I -

0 0 * * l - * L L * a * a * u i t - * <

* n

* a

N

11

m

r I-

a -I L

J

2 0

I-

z Q W c z

U

a

U

a

k-4

* r -4

II

* * * * * 4 * * 4

* * 4

0 8 * * * * * * * * 9

* t 3 c * - * A 6 U O m * - * I - * a 0 5 0 0 * u * r - * e * E * o * a

e n

t a

0

0: w

m a 0 . m s 2 a 11 G + _ ) w n - -

I- t II ~ u a a O E M > n v a w a w w v ~ m n n a a w n n

U W a - 'rl c 6 ir W V 2 < ,Y 3 z m U

V

0 O II a 2 W a a a m

V

LL

V

I- In W r 0 0 I I I 4 I II

I I I B I

V

l-4

i m

W m z - I I o r I N O 1 4 - 1 I II If I II tl I I v u I Z Z f

I i m m I corn I

I I I I I

I t I I I

u v u

NlP II I1 w w f f icc

V

4 3 3

Q * * * 3 * Q * t * * * * 3 * 3 V V

LL o c a . v , W A - I 3: II w a 0 3

N I L In II 0 x II v\ II I f LL 4 NI-I-

w t - . & J A CC Z O N W W

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a II II vr ln

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m

Lo m r

.-I

9

m N \ 4 0 \ 0 En

h m

IC

B r

z c LL

4 It I-

0 n

J. )c

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. $ - *

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t w 0 W

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z

a -

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n z U

0 . R! +

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v

n

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rJ-

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0 - ,-I 0 c 0 0

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W R v? t N a- i-

o\

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\

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0 4 . (0 \ J H

0 c m 0 0 X 1c -t

0 t C z w z

-W e +

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em

- W *I-

Hfn I V ** N J -m - J n w

H

o a

a

a

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L

w 3 z W > W Q! I z 0 z ln - a 0 m a -I

LLt V z a

* .O

s m m a In + + - a - -- A #

l n o r + + Y X O 00

nt- t-- - \

a 2 - t m

. A

A - - + + e * d

A - - \ \ * .O

u u u u V V

0 0 d

m 0 4

\ w - - T - A -

.-( a z o - 8 w u z

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1. Report No. 2. Government Accession No. 3. Recipient's Catalog No.

NASA TM- 801 96 5. Report Date

6. Performing Organization Code

4. Title and Subtitle January 1980

COMPUTER PROGRAMS FOR ESTIMATING SUBSONIC CIVIL AIRCRAFT ECONOMICS

7. Author(s) Dal V . Maddalon 8. Performing Organization Report No. John I(. Molloy Milton J. Neubauer, J r .

, 10. Work Unit No.

791 -40-43-01 11. Contract or Grant No.

9. Performing Organization Name and Address

NASA Langley Research Center Hampton, VA 23665

13. Type of Report and Period Covered

12 Sponsoring Agency Name and Address Techni cal Memorandum National Aeronautics and Space Administration Washington, DC 20546

14. Sponsoring Agency Code

I 15. Supplementary Notes

16. Abstract

Computer programs to calculate a i r l i n e d i rec t operating cost, and indirect operating cost and return on investment were developed to provide a means for determining commercial a i r c ra f t l ife-cycle cost and economic performance. These program codes can be easi ly incorporated into existing a i r c ra f t design programs. A o f the program.

representative wide-body subsonic j e t a i r c r a f t was evaluated to i l l u s t r a t e use

17. Key Words (Suggested by Author($))

AIRCRAFT ECONOMICS DIRECT OPERATING COST INDIRECT OPERATING COST RETURN ON INVESTMENT

18. Distribution Statement

Unclassified - Unlimited Subject Category 83

I

19. Security Classif. (of this report) 20. Security Classif. (of this page] 21. No, of Pages 22. Price'

Uncl assi f ied Unclassified 50 $4.50

* For sale by the National Technical Information Service, Springfield, Virginia 22161