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Learning and Forgetting in the Jet Fighter Aircraft Industry

Anelí Bongers ()

No 2017-02, Working Papers from Universidad de Málaga, Department of Economic Theory, Málaga Economic Theory Research Center

Abstract: A recent strategy carried out by the aircraft industry to reduce the total cost of new generation fighter has consisted in the development of a single airframe with different technical and operational specifications. This strategy has been designed to reduce costs in the Research, Design, and Development phase with the aim of reducing the final unitary price of aircraft. This is the case of the F-35 Lightning II, where three versions, with significant differences among them, are produced simultaneously based on a single airframe. Whereas this strategy seems to be useful to reduce pre-production sunk costs, remains key to study their effects on production costs. This paper shows that this strategy can imply larger costs in the production phase by reducing learning acquisition and hence, the total effect on the final unitary price of the aircraft is indeterminate. Learning curves are estimated based on the flyaway cost for the latest three fighter aircraft models: The A/F-18E/F Super Hornet, F-22A Raptor, and the F-35A Lightning II. We find that learning rates for the F-35A are significantly lower (an estimated learning rate around 9%) than for the other two models (around 14%).

Keywords: Learning curve; organizational forgetting; jet fighter aircraft; flyaway cost (search for similar items in EconPapers)
Pages: 25 pages
Date: 2017-06
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Persistent link: https://EconPapers.repec.org/RePEc:mal:wpaper:2017-2

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