There’s an interesting post on military aircraft procurement over at Winds of Change today (interesting if you’re interested in such things, that is).
Norm Augustine, former head of Martin Marietta (now part of Lockheed Martin) wrote an amusing (and insightful) book back in the eighties called “Augustine’s Laws” (it’s now on its sixth edition
One point made in comments over there is that the reason these things cost so much per unit (I was shocked to read that the Raptor is a third of a billion dollars per unit) is because it includes amortization of the development and fixed production costs–if they had decided to purchase the originally planned seven hundred, the price per aircraft would be much lower. The problem is that, though we get more bang for the buck, we never want to spend that many bucks.
We did the same thing with the Shuttle. It was about a five-billion-dollar development program, in seventies dollars, but when the fleet size was cut from seven to five during Carter-Mondale (Mondale actually wanted to completely kill the program) as a cost saving, the price per orbiter went up a good bit. It would have probably only cost an additional billion or so to get the two extra vehicles, and we’d be in a lot better shape now (all other events since being equal) with a remaining fleet of five, instead of three. Having had two more might have made us more willing to continue to press forward even in the face of the losses, because even if the president hadn’t decided to end the program next year, we’d probably have to do it anyway, particularly if we lost one more, and had only two left. In fact, one of the few smart moves made on the program in the eighties was to order “structural spares” (things like the titanium keel and spar) before the production was shut down and tooling dismantled. That allowed us to build Endeavor after Challenger, something that would not have been possible otherwise, and in the absence of that new vehicle, we’d have been down to two after the Columbia loss.
We’re not just penny-wise pound-foolish in production. The Shuttle has a similar problem in ops. If we’d had more vehicles, and made the investment in facilities for them, we could have doubled the flight rate, without that much of an increase in annual fixed costs (perhaps a billion more a year). Which would have been a better deal: four flights a year for three billion a year (a typical number), resulting in a cost of three quarters of a billion per flight, or eight flights a year for four billion, with a cost of half a billion per flight?
Neither number is attractive, but the taxpayer would have gotten a lot more for the money if the purse strings had been loosened on the program. It might have made it a lot more sustainable.
They are playing some funny games over there with the math. The F-22 cost is about right, but only if you include the development cost. This cost is sunk though. The “flyaway” cost of a new Raptor is right at $120 million.
You can’t say that we could buy 5 F-16s for the cost of a Raptor, and compare the total amortized cost of an F-22 to the flyaway cost of a new F-16. If you look at the aquisition costs, it’s a lot closer to 2:1. Spent money is spent money.
Now, it may be instructive to look at from a “where did we go wrong” standpoint for future aquisitions, but it has zero to do with how much it costs to buy another unit.
What your talking about, especially with the Shuttle program, is the kind of long range thinking we as civilians do when buying durable goods. We weigh the overall need, the initial cost, long range cost, operating and maintenance costs and replacement costs downstream. And why do we do all that brain sweat?
Because we are working from our own finite supply of money! We can’t just “tax” ourselves a raise from our employers because didn’t plan right or because we want a newer thing-a-ma-jig.
Remember that the same clowns who use our tax dollars to procure these gub’ment chattlels with sad effect, are the very same ones who plan for a 5% increase, committee it to down a 3 1/2 % increase, and then try to convince us it was a savings or a cut back or a shortfall. That definition of course depends on which side of the aisle they bow to, or what the program is.
With sound financial thinking like that, it’s no wonder Mr. Augustine’s prediction came true.
I think it’d be very instructive, Mark. One of the issues, I see, is that these programs were justified on economic grounds, and those grounds were only justified if the US spent large sums of money. So you front-load huge development costs. Later on, to save costs, they buy less of the finished product, negating the economic benefit.
One of the nicest things about the Ares 1 and Ares V is that they are designed with a low flight rate in mind. So that eliminates one of the tricks that the Shuttle supporters used in the 70’s. It still leaves another front-load. Namely, the HLV part gets put off several years to develope an unnecessary Ares 1, on the dubious theory that having parts in common with the Ares I will lower costs.
Had we been interested in cost effectiveness we never would’ve opted for the Shuttle in the first place, sticking to the Saturn architecture instead.
Lost opportunity there:-(.
Had we been interested in cost effectiveness we never would’ve opted for the Shuttle in the first place, sticking to the Saturn architecture instead.
The Saturn wasn’t cost effective, either. If it had been, we would in fact have continued it.
Had we been interested in cost effectiveness we never would’ve opted for the Shuttle in the first place, sticking to the Saturn architecture instead.
Lost opportunity there:-(.
I don’t know about more shuttles orders in the late seventies, given it was basically a prototype. I have some sympathy for the idea that an incremental second generation shuttle series of shuttles should have been ordered in the late eighties, after 20 or so flights were under NASA’s belt, and Lessons had been Learned. Of course, they got that opportunity in tragic fashion, and Rockwell even offered to produce three upgraded shuttles for the price of Endeavor; however, NASA declined the offer in favor of the commonality advantage of an OV-10* series shuttle.
Ironically, it was Administrator Trudy’s pursuit of more orbiters a few years later that helped kill SEI.
One of the nicest things about the Ares 1 and Ares V is that they are designed with a low flight rate in mind. So that eliminates one of the tricks that the Shuttle supporters used in the 70’s. It still leaves another front-load. Namely, the HLV part gets put off several years to develope an unnecessary Ares 1, on the dubious theory that having parts in common with the Ares I will lower costs
Even the HLV becomes unnecessary if you go with orbital rendezvous and docking.
I love how Congress cuts unit purchases because the price per unit (including sunk costs) is “too high”, and then complains when the price per unit (still including sunk costs) goes *up*, after which they typically decide that the solution is to cost more units from the buy, and…
One of the nicest things about the Ares 1 and Ares V is that they are designed with a low flight rate in mind.
At the low flight rates planned, neither makes any sense to develop. Nor, for that matter, does a prolonged human spaceflight program of any kind make sense at low flight rates.
At the low flight rates planned, neither makes any sense to develop. Nor, for that matter, does a prolonged human spaceflight program of any kind make sense at low flight rates.
Yes, something that few people in the space activist community (at least the ones pleading for more money for human spaceflight) don’t understand.
Either half a billion or three quarters of a billion per flight is ridiculous, and Constellation will do nothing to improve on this.