Investigating optimal replacement of aging air force systems

Edward Keating and Matthew Dixon

Defence and Peace Economics, 2004, vol. 15, issue 5, 421-431

Abstract: An availability-oriented approach has been developed to decide when to replace an aging system. For an existing system, it is optimal to operate another year if and only if the incremental cost per available year is less than the lifetime average cost per available year of a new aircraft. We illustrate our approach using United States Air Force KC-135 tanker data. In demonstrating our approach, we find it will be optimal to replace the KC-135 by the end of the decade.

Keywords: Repair versus replace, United States Air Force, KC-135, Aging aircraft, Reliability and Maintainability Information System (REMIS), Aircraft availability, JEL codes: H4; H56; H57, (search for similar items in EconPapers)
Date: 2004
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DOI: 10.1080/1024269042000246224

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