If you’ve been paying attention to the battle for US air dominance, you might be, like me, a little wary of the comparisons and the rhetoric, writes blogger BlackFive. Since there are numbers flying all over the place with regards to cost (mostly from PR firms), I thought we ought to take a look at what the REAL cost of an F-35 is…and we’ll look at it in the same terms that the DoD/USAF use to evaluate the bids.
First, we need to talk in terms of 2010 dollars. We?e talking about what is known as the Unit Recurring Fly Away cost (URF) for a conventional take-off and landing (CTOL) variant (the type the Air Force is buying). In 2010 terms, it will cost about $65 million dollars.
Whoa, wait a minute, you say, I?e seen costs as high as $110 million a copy!
I? sure you have. But they don? reflect the URF. Instead they may reflect the Total Ownership Cost (TOC) – the cost of everything necessary to operate the aircraft over the span of its service life – or any of a number of other costs used in the project for various purposes, but it won? reflect the one we should be most concerned with, the URF.
Think of buying a new car. You go in, look at the sticker price and ask the sales person, ?ow much will it cost me to drive this car off the lot?? He or she is going to give you a cost at or near the sticker price. You?e going to negotiate it down and, if you strike a deal, you?l drive it off the lot for that negotiated price. That? the URF in a nutshell.
With me so far?
But does that cost reflect the TOC?
Of course not.
Gas and oil. Extra cost. Maintenance. Extra cost. Extended warranty. Extra cost. Parts. Extra cost. Labor. Extra cost. New tires. Extra cost. Etc. In fact, if you take all of those costs associated with owning, driving and maintaining the car over the years you own it you?l find that TOC to be significantly higher than the cost to drive it off the lot (URF).
Of course that? the case for any fighter aircraft. However, in the media, the price you see applied to the F-35 may reflect the higher TOC and not the URF. When such a cost basis is used without identifying it, you end up comparing apples and pomegranates. The TOC is not what it will cost to fly the plane off the lot.
Continue reading BlackFive’s post here.