Monday, 15 November 2010

Aircraft Operating Costs

Recent arguments about the decision to cut the Harrier force have led to a great deal of discussion about aircraft operating costs.

Figures for "cost per flying hour" given in Parliament are usually inclusive of all capital costs.

Day to day costs such as fuel and parts are known as "variable costs" and are not usually given by the British government.

There was a rather odd recent exception to this,Lord Moonie tabled the following question in the House of Lords:

"To ask Her Majesty's Government what are the average annual running costs, including personnel and materiel costs, of a squadron of Tornado GR4 aircraft."

The Parliamentary Under-Secretary of State,Ministry of Defence (Lord Astor of Hever),gave the following answer: 

"A broad estimation is in the order of around £20 million per annum.
This figure includes the direct variable costs of fuel, servicing and squadron personnel, but does not include fixed costs such as basing,platform support costs,or depreciation."

All the fixed costs excluded from that figure are included in the "cost per flying hour" which is more commonly given in Parliament.
It should be noted that aircraft fleets are very fluid and consequently there are fluctuations in these costs from year to year.
It is best to look at costs from a number of years before drawing any conclusions.
An allowance should also be made for the effects of inflation.
The following figures have been given in Parliament in recent years.

On the 29th of July 2009 the following figures were given for cost per flying hour:

Tornado F.3,£45,000;
Tornado G.R.4,£28,000;

Tornado G.R.4,£33,000;

Harrier,£36,000 (2005-06),£37,000 (2006-07),£38,000 (2007-08);
Lynx,£16,000 (2005-06),£16,000 (2006-07),£19,000 (2007-08);
Merlin,£40,000 (2006-07),£42,000 (2007-08);
Sea Harrier F.A.2,£44,000 (2003-04),£45,000 (2004-05),£46,000 (2005-06).

On the 25th of June 2007 the following figures were given for cost per flying hour:

Tornado F.3,£40,440;
Tornado G.R.4,£32,680.

Tornado G.R.4,£35,000;
Typhoon F.G.R.4,£70,000;
Harrier G.R.7/9,£37,000;
Tornado F.3,£43,000.

On the 13th of January 2010 the following figures were given for cost per flying hour:

Sea King,£14,000.

On the 22nd of May 2007 the following figures were given for cost per flying hour:

Merlin H.C.3,£34,000;
Merlin H.M.1,£42,000.

On the 8th of April 2010 the following figures were given for cost per flying hour:

E-3D Sentry A.E.W 1,£33,000;
Hercules C-130J,£12,000;
C-17 Globemaster III,£42,000.

On the 1st of April 1998 the following figures were given for cost per flying hour:

Tornado G.R.1,£23,300.

Sometimes annual operating costs are given.

On the 12th of October 2004 the following figures were given for annual operating cost:

Tornado G.R.4,£10.4 Million;

Jaguar G.R.1/3,£5.6 Million;

Jaguar T.2/3,£5.5 Million;

Tornado F.3,£9.1 Million,

Typhoon,£4.7 Million (estimated for 2004-05).

On the 12th of October 2004 the following figures were given for annual support cost (at 2004–05 prices).

Tornado,£1.6 Million;

Jaguar,£1.5 Million;

Typhoon,£2.2 Million (estimated).

The "annual operating cost" figures include all costs associated with owning and operating the aircraft,including capital costs.

The "annual support cost" figures cover only direct costs.

The latter appears to be the basis of Lord Astor of Hever's recent claim that a Tornado G.R.4 squadron has annual "running costs" of £20 Million.

Work in progress beyond this point,to be continued.....
Tornado F3 crews fly about 183 flying hours a year; Tornado GRI crews, 210; Harrier crews, 206; and Jaguar crews, 197.
The Jaguar's cost per flying hour is only £13,000—markedly less than that of the Tornado, which is £23,000. The maintenance hours per flying hour are 12.2 for the Jaguar and 17 for the Tornado.


steve said...

Flying hour costs are difficult things to understand. But for me it is maintenance hours to flying hours are the figures that don't get produced. I am always surprised by how many don't understand that aircraft aren't like cars. It isn't a case of jump in and go.

But back to your point I remember getting really excited when I realized the Mi-26 cost a quarter of the price of a Merlin HC. And had a quarter of the running costs. Well I was excited for a bit anyway. :)

Chuck Hill said...

Separating fixed and variable costs is the only thing that makes sense from a governmental point of view.

Fixed costs for aircraft you already own are already sunk, so don't enter into rational decision making.

Operating costs should be the basis of the types of decisions being made recently.