The Annual Cost of Corrosion for Air Force Aircraft and Missile Equipment_Jun2009

170 Pages·2009·1.68 MB·English

THE ANNUAL COST OF CORROSION
FOR AIR FORCE AIRCRAFT
AND MISSILE EQUIPMENT
REPORT MEC81T2
David A. Forman
Ron Baty
Eric F. Herzberg
Amelia R. Kelly
Muthu V. Kumaran
Norman T. O’Meara, Ph.D.

JUNE 2009
NOTICE:
THE VIEWS, OPINIONS, AND FINDINGS CON-
TAINED IN THIS REPORT ARE THOSE OF LMI
AND SHOULD NOT BE CONSTRUED AS AN OFFI-
CIAL AGENCY POSITION, POLICY, OR DECISION,
UNLESS SO DESIGNATED BY OTHER OFFICIAL
DOCUMENTATION.
LMI © 2009. ALL RIGHTS RESERVED.
The Annual Cost of Corrosion for Air Force Aircraft and Missile Equipment
MEC81T2/JUNE 2009
Executive Summary
We know from earlier studies that the annual cost of corrosion for Department of
Defense (DoD) facilities, infrastructure, and equipment is between $9 billion and
$20 billion.1 Although the spread between these estimates is large, both figures
confirm that corrosion costs are substantial. Congress, concerned with the high
cost of corrosion and its negative effect on military equipment and facilities and
infrastructure, enacted legislation in December 2002 that endowed the office of
the Under Secretary of Defense for Acquisition, Technology, and Logistics
(USD[AT&L]) with the overall responsibility for preventing and mitigating the
effects of corrosion on military equipment and infrastructure.2,3
Under the leadership and sponsorship of the USD(AT&L), LMI assessed the cost
of corrosion for Air Force aircraft and ballistic missile equipment, using FY2007
as a measurement baseline. Using a method approved by the Corrosion Prevention
and Control Integrated Product Team (CPC IPT), we estimated the annual corro-
sion cost for Air Force aircraft and missiles to be $5.4 billion.
The method we used to measure corrosion-related cost4 focuses on tangible direct
material and labor costs, but it also considers some indirect costs that are outside
normal maintenance reporting, like research and development (R&D) and train-
ing. We used a combined top-down and bottom-up approach to arrive at this cor-
rosion cost estimate. The top-down portion uses summary-level cost and budget
documentation to establish spending ceilings for depot- and field-level mainte-
nance for both organic and commercial maintenance activities. This establishes a
maximum cost of corrosion in each activity. The bottom-up portion uses detailed
work order records to account for actual occurrences of corrosion maintenance

1 The $9 billion estimate is from Kinzie and Jett, DoD Cost of Corrosion, 23 July 2003, p. 3.
The $20 billion estimate is from Gerhardus H. Koch et al., Corrosion Cost and Prevention Strate-
gies in the United States, CC Technologies and NACE International in cooperation with the
Department of Transportation, Federal Highway Administration, 30 September 2001.
2 The Bob Stump National Defense Authorization Act for Fiscal Year 2003, Public Law 107-314,
2 December 2002, p. 201.
3 Public Law 107-314 was enhanced by Public Law 110-181, The National Defense Authori-
zation Act for Fiscal Year 2008, 28 January 2008, Section 371.
4 “Cost” includes known or identified actual expenditures.
iii
and prevention actions. This establishes a minimum level of corrosion costs in
each activity area. When necessary, we use statistical methods to bridge any sig-
nificant gaps between the top-down and bottom-up figures to derive a final esti-
mate for the cost of corrosion in each area.
This cost estimation method was documented in an August 2004 report issued by
the CPC IPT.5 The current cost-of-corrosion study of Air Force aircraft and mis-
siles is part of a multiple-year plan to measure the cost of corrosion for DoD using
the proposed method. Past and future study areas are listed in Table ES-1. At
32 percent, the Air Force’s corrosion costs as a percentage of total maintenance
are the highest of the studies completed thus far.
Table ES-1. Cost-of-Corrosion Studies
Study year Study segment Annual cost of corrosion Data baseline
2005–2006 Army ground vehicles $2.0 billion FY2004
Navy ships $2.4 billion FY2004
2006–2007 DoD facilities and infrastructure $1.8 billion FY2005
Army aviation and missiles $1.6 billion FY2005
Marine Corps ground vehicles $0.7 billion FY2005
2007–2008 Navy and Marine Corps aviation $3.0 billion FY2005 and FY2006
Coast Guard aviation and ves-
$0.3 billion FY2005 and FY2006
sels
2008–2009 Air Force aircraft and missiles $5.4 billion FY2006 and FY2007
Army ground vehicles $2.4 billion FY2006 and FY2007
Navy ships pending FY2006 and FY2007
2009–2010 Repeat 2006–2007
2010–2011 Repeat 2007–2008

We used 2 years of data for the most recent study, as compared to a single year of
data in previous efforts. This enhancement to our study method yielded more in-
depth data and additional data points for analysis. We base our discussion and
primary analysis on the most recent data (FY2007), but provide both FY2006 and
FY2007 results in the database.
The scope of our study included an inventory of 5,774 Air Force aircraft and
2,258 Air Force missiles. We estimated $5.3 billion for corrosion costs for
112 types of Air Force aircraft and $100 million for corrosion costs for 9 types of
Air Force missiles.
We used three schema groups to categorize corrosion costs associated with air-
craft and missile equipment: Group 1—Depot-level maintenance (DLM) costs,
field-level maintenance (FLM) costs, and costs that are outside normal reporting
(ONR); Group 2—Corrective versus preventive costs; and Group 3—Structure-
related versus parts-related costs.

5 CPC IPT, Proposed Method and Structure for Determining the Cost of Corrosion for
the Department of Defense, August 2004.
iv
Executive Summary
In Figure ES-1, we show the study results segregated by schema. Percentages
reflect the relative ratio of the different schemas.
Figure ES-1. Cost of Corrosion for Air Force Aircraft and Missile Equipment
by Schema (FY2007 data)
Percentage
Aviation Type 141 Cost
of total
Percentage
Aviation Type 080 Cost
of total
Aviation Type 001 Cost Peorcf etonttaalge Schema (Tino mtaill l icoonsst) Pofe trocteanl tcaogset
DLM corrosion costs DLM corrosion costs $2,997 55%
FLM corrosion costs FLM corrosion costs $2,289 42%
ONR corrosion costs ONR corrosion costs $147 3%
Corrective corrosion costs Corrective corrosion costs $2,551 48%
Preventive corrosion costs Preventive corrosion costs $2,736 52%
Structure corrosion costs Structure corrosion costs $1,340 25%
Parts corrosion costs Parts corrosion costs $3,810 72%

Note: This figure does not depict the $136 million in corrosion costs that we are unable to assign to either
structure or parts.
Corrosion-related DLM costs ($2.997 billion) exceed corrosion-related FLM costs
($2.289 billion) by more than $700 million; however, each is approximately 32 per-
cent of their respective total aircraft and missile maintenance cost (see Table ES-2).
Together, DLM and FLM account for 97 percent of the total combined corrosion
cost for Air Force aircraft and missiles ($5.286 billion). ONR corrosion costs are
minor ($147 million) when compared to those associated with DLM and FLM.
Table ES-2. Comparison of Air Force DLM and FLM Corrosion Cost
as a Percentage of Maintenance Cost (FY2007)
Corrosion as a percentage
Maintenance Total aircraft and missile Corrosion of total aircraft and missile
level maintenance cost cost maintenance
Depot $9,289 million $2,997 million 32.3%
Field $7,121 million $2,289 million 32.1%
Total $16,410 million $5,286 million 32.2%
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Slightly more of the corrosion costs are associated with preventive (52 percent)
rather than corrective maintenance (48 percent). It’s not clear what the optimum
corrective-to-preventive ratio of corrosion costs should be, but DoD hopes to learn
about optimum ratios as studies continue. In addition, the corrosion cost of parts
greatly exceeds the corrosion cost of structures by a ratio of almost 3 to 1.
We stratified the corrosion costs of Air Force aircraft and missiles mission design
series (MDS) by total cost and cost per item. We then ranked the top 10 for average
corrosion cost and total corrosion cost (see Table ES-3). The aircraft listed in Table
ES-3 are candidates for further focus. The order in which they are listed suggests a
priority for further examination.
Table ES-3. Air Force Aircraft and Missiles with the Highest Combined Rankings
of Average Corrosion Cost Per Item and Total Corrosion Cost
Corrosion cost Per-item
Top General per item corrosion cost Total corrosion Total corrosion Combined
10 nomenclature (in millions) rank cost (in millions) cost rank rank
1 B-1B $3.7 1 $251.2 5 6
2 B-52H $2.6 5 $240.3 6 11
3 C-5A $3.5 2 $203.8 9 11
4 KC-135R $1.2 12 $451.4 2 14
5 A-10A $1.1 14 $276.2 3 17
6 C-5B $1.7 7 $81.1 12 19
7 C130-J $2.1 6 $80.5 13 19
8 B-2A $3.0 3 $63.3 17 20
9 C130-H $1.0 16 $273.8 4 20
10 MC-130H $2.9 4 $58.4 18 22

Since the early 1990s, the Air Force has sponsored a series of studies to determine
its annual direct corrosion maintenance costs. The most recent study—completed
in FY2004—estimated the Air Force’s annual direct corrosion cost to be $1.5 bil-
lion (FY2004 dollars). There are several significant reasons for the $3.93 billion
difference between the results of that most recent study ($1.5 billion) and our re-
sults ($5.43 billion). The major differences, which account for $3.44 billion (or 88
percent of the difference), are as follows:
(cid:161) CPC IPT method includes commercial depot costs (difference of $1.33 billion)
(cid:161) CPC IPT method includes indirect labor costs (difference of $1.62 billion)
(cid:161) Increase in labor rates (difference of $0.65 billion)
(cid:161) Difference in study elements (difference of −$0.16 billion).
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Contents
Chapter 1 Background and Analysis Method............................................1-1
STUDY OBJECTIVES...................................................................................................1-2
STUDY DEFINITIONS AND ASSUMPTIONS......................................................................1-2
Types of Corrosion Cost Decisions...................................................................1-3
Effects of Corrosion...........................................................................................1-3
What Is a Corrosion Cost? ................................................................................1-4
Deferred Maintenance.......................................................................................1-5
Identifying Corrosion Cost.................................................................................1-6
Use of Corrosion Cost Information....................................................................1-6
CORROSION COST CATEGORIES.................................................................................1-7
DLM, FLM, and ONR Costs...............................................................................1-7
Corrective and Preventive Costs.......................................................................1-8
Structure and Parts Costs ...............................................................................1-10
TOP-DOWN AND BOTTOM-UP COSTING OF DOD CORROSION.....................................1-11
Top-Down Cost Measurement.........................................................................1-11
Bottom-Up Cost Measurement........................................................................1-12
Combined Top-Down and Bottom-Up Cost Measurement ..............................1-13
CORROSION COST TREE..........................................................................................1-14
DATA STRUCTURE AND ANALYSIS CAPABILITIES.........................................................1-16
AIR FORCE AIRCRAFT ORGANIZATION.......................................................................1-17
Aircraft Maintenance Structure........................................................................1-18
Aircraft Corrosion Organization.......................................................................1-20
Aircraft and Missiles Equipment List................................................................1-21
REPORT ORGANIZATION...........................................................................................1-22
Chapter 2 Air Force Aircraft and Missile Corrosion Costs.........................2-1
DETERMINATION OF CORROSION COSTS.....................................................................2-1
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DLM COST OF CORROSION (NODES A AND B )........................................................2-2
Maintenance Process Versus Maintenance Repair...........................................2-2
Organic DLM Corrosion Costs (Nodes A1 and B1 ).......................................2-5
Commercial DLM Corrosion Costs (Nodes A2 and B2 )..............................2-20
FLM COST OF CORROSION (NODES C AND D )......................................................2-22
FLM Top-Down Analysis .................................................................................2-24
FLM Bottom-Up Analysis.................................................................................2-28
ONR COST OF CORROSION (NODES E , F , AND G )..............................................2-34
Labor of Non-Maintenance Aircraft and Missile Operators (Node E ).............2-34
Priority 2 and 3 Costs (Node F ).....................................................................2-36
Purchase Cards (Node G ).............................................................................2-38
FINAL AIR FORCE AIRCRAFT AND MISSILE CORROSION COST TREE
(NODES A THROUGH G )...........................................................................2-39
Chapter 3 Summary and Analysis of Corrosion Costs..............................3-1
AIR FORCE CORROSION COSTS BY NODE....................................................................3-1
AIR FORCE CORROSION COSTS BY EQUIPMENT TYPE..................................................3-2
AIR FORCE CORROSION COSTS BY WUC....................................................................3-6
AIR FORCE CORROSION COSTS—CORRECTIVE VERSUS PREVENTIVE COSTS................3-8
AIR FORCE CORROSION COSTS—PARTS VERSUS STRUCTURE ....................................3-9
2004 USAF DIRECT COSTS OF CORROSION STUDY..................................................3-10
Appendix A Corrosion Cost Element Definitions
Appendix B Typical Corrosion Activities
Appendix C Air Force Aircraft and Ballistic Missile Equipment
Appendix D Air Force Aircraft and Missile Corrosion Cost Data
Sources by Node
Appendix E Depot-Level Corrosion Profile
Appendix F Key Corrosion Words
Appendix G Mapping Work Unit Codes to Work Breakdown Structure
and Parts and Structure
viii
Contents
Appendix H Field-Level Corrosion Profile
Appendix I Air Force Survey Results
Appendix J Abbreviations

Figures
Figure 1-1. Corroded Helicopter..............................................................................1-4
Figure 1-2. Preventive and Corrective Corrosion Cost Curves...............................1-9
Figure 1-3. Top-Down Corrosion Cost Measurement Method ..............................1-11
Figure 1-4. Bottom-Up Corrosion Cost Measurement Method..............................1-12
Figure 1-5. Combined Top-Down and Bottom-Up Approach ................................1-14
Figure 1-6. Corrosion Cost Tree...........................................................................1-14
Figure 1-7. Corrosion Cost Tree—Depot Maintenance Costs...............................1-15
Figure 1-8. Data Structure and Methods of Analysis.............................................1-16
Figure 1-9. Air Force Major Command Structure..................................................1-18
Figure 1-10. AFMC Structure for Depot-Level Aircraft Maintenance.....................1-19
Figure 1-11. AFCPCO Command Structure..........................................................1-21
Figure 2-1. Air Force Aircraft and Missile Equipment Sustainment Corrosion
Cost Tree...........................................................................................................2-1
Figure 2-2. Air Force Aircraft and Missile DLM Corrosion Costs (in millions)..........2-4
Figure 2-3. Air Force Aircraft and Missile Organic DLM Corrosion Costs
(in millions, FY2007)..........................................................................................2-6
Figure 2-4. Air Force Aircraft and Missile Organic DLM Labor Cost Tree
(in millions)......................................................................................................2-11
Figure 2-5. Air Force Aircraft and Missile Organic DLM Materials Cost Tree
(in millions)......................................................................................................2-17
Figure 2-6. Air Force Aircraft and Missile Commercial DLM Cost Tree Section
(in millions)......................................................................................................2-20
Figure 2-7. Use of Corrosion Ratios to Determine Commercial DLM Corrosion
Cost (Example—B1-B, Lancer [MDS: B001B])................................................2-22
Figure 2-8. Air Force Aircraft and Missile FLM Corrosion Cost (in millions)..........2-23
Figure 2-9. Air Force Aircraft and Missile Organic FLM Labor Corrosion Cost
(in millions)......................................................................................................2-29
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Figure 2-10. Air Force Aircraft and Missile Organic FLM Materials Corrosion
Cost (in millions)..............................................................................................2-32
Figure 2-11. Air Force Aircraft and Missile Commercial FLM Labor
and Materials Corrosion Costs (in millions).....................................................2-33
Figure 2-12. Air Force Aircraft and Missile Corrosion ONR Costs........................2-34
Figure 2-13. Final Air Force Aircraft and Missile Corrosion Cost Tree..................2-39
Figure 3-1. MDS: F016C; F-16C Fighting Falcon....................................................3-3

Tables
Table 1-1. Cost-of-Corrosion Studies to Date and Future Efforts ...........................1-2
Table 1-2. Prioritization of Corrosion Cost Elements..............................................1-6
Table 1-3. Classification of Corrosion Cost Elements into Preventive
or Corrective Natures ........................................................................................1-9
Table 1-4. Air Force Aircraft and Missiles by Component.....................................1-21
Table 2-1. DLM Action Steps for Air Force Aircraft and Missile Equipment............2-3
Table 2-2. Air Force Aircraft and Missile Equipment DLM Organic
and Commercial Corrosion Cost (in millions).....................................................2-5
Table 2-3. Percentage of DLM Workload for Air Force Aircraft and Missiles..........2-8
Table 2-4. Distribution of Organic DLM Labor Costs by Maintenance
Action Step......................................................................................................2-12
Table 2-5. Work Records Assigned to DLM Steps 1, 4, 7, or M
(Notional Example—F-16 Fighting Falcon at ALC Ogden)..............................2-13
Table 2-6. Organic DLM Data with Labor Records Analyzed for Corrosion
Cost using Corrosion-Related Keywords (Notional Example—
F-16 Fighting Falcon at ALC Ogden)...............................................................2-14
Table 2-7. Applying the Corrosion Percentages to Determine Organic DLM
Labor Corrosion (Notional Example—F-16 Fighting Falcon at ALC Ogden) ...2-15
Table 2-8. Organic DLM Aircraft and Missile Labor and Corrosion Costs
by Process Step..............................................................................................2-16
Table 2-9. Relationship of Labor Maintenance Operation to JON
(Notional Example—F-16 Fighting Falcon at ALC Ogden)..............................2-18
Table 2-10. Relationship of Materials Requisition to JON
(Notional Example—F-16 Fighting Falcon at ALC Ogden)..............................2-19
Table 2-11. Allocation of Material Costs to Labor Records
(Notional Example—F-16 Fighting Falcon at ALC Ogden)..............................2-19
x