2.810 cost adventureweb.mit.edu/2.810/www/files/lectures/lec20-cost-2019.pdfbudget issues •retail...
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2.810 Cost AdventureJohn Lewandowski
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Assumptions/constraints
- Must keep holes/locations- Must achieve approximately same strength- Cost will include material/tooling/production
How does our manufacturing process, design, and cost per part change as our company grows in size and sells higher quantity?
L-bracket LLC
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First prototype: L-bracket by 3D printing
Additive X
Additive Y
Additive Z
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Let’s separate production levels
• Prototyping: QTY 1-10• Demo units (design changes needed)
• Lead time: days
• Short-term manufacturing: QTY 10-1,000• Products for first-customers (functional)
• Lead time: weeks
• High-quantity production: QTY 1,000-1,000,000• Scaled mass manufacturing (throughput)
• Lead time: months
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L-bracket via extrusion and machining
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L-bracket by 3D printing (less material)Additive
Additive X
Additive Y
Additive Z
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L-bracket via sheet metal forming or waterjet
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L-bracket
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Fill Pressure OK.
1,000 psi.
Number of Gates: 1.
Gate Type: Tab.
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Part is too big for a multi cavity mold in a standard sized machine
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L-bracket by injection molding
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L-bracket via casting
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Assuming each part is optimizedBreakeven between die casting and machining is at ~20,000 unitsInjection molding becomes cost effective at under ~1000 unitsMachining/waterjet/sheet metal are very competitive for low qtyAdditive has no scaling advantage, only useful for a few parts
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$-
$50.00
$100.00
$150.00
$200.00
$250.00
$300.00
1 10 100 1000 10000 100000 1000000
Cavity trade-offs
1 Cavity 2 Cavity 4 Cavity 8 Cavity
Break even points
2 Cavity ~50004 Cavity ~100008 Cavity ~25000
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Takeaways
• Think about the sensitivity analysis and risk: what if wages increase, material changes (quality, cost), design/function changes (more holes in the bracket, thicker part)
• Even the simplest part can have significant trade-offs between manufacturing cost and functionality
• There will be multiple iterations for every process
• All departments/skills should be involved in the discussion
• Let’s see a real life example of when not everybody was involved in the decision-making process…
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Apple has machined
Aluminum, let’s cast our
computer out of magnesium
Go tell marketing to announce a magnesium
laptop
Then go talk to engineering to design it, we’re taking over this
industry
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Laptop Enclosure Manufacturing Cost and Process Breakdown
Top Cover
Keyset Cover
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Raw MaterialExtruded Mg billet
Anti-Corrosion TreatmentCeramic anti-corrosion coating
Top Cover
Keyset Cover
PaintSpray + Conveyor
CNC Milling7 operations, 98.3 minutes total
Step 3
80.5
min
Step 2
10.5
min
Ste
p 6
7.5
mi
n
CNC Milling6 operations, 105.3 minutes total
Step 5
16.1
min
Step 2
23.8
min
Step 3
48.1
min
Raw MaterialExtruded Mg billet
MgC
Line
Anti-Corrosion TreatmentCeramic anti-corrosion coating
MgC
Line
Logo SubassemblyAssembly + Inspection
Laser
Paint
Ablation
Logo
Inspect
ion
Secondary OperationsLaser etching + Paint touch-up
Vent Hole
Micro-
spray
Laser
Etch
PaintSpray + Conveyor
Paint
Line
Paint
Line
Post-CNC Robot deburr and wash
Was
h
LineRob
ot
Deb
urr
Wash
Line
Post-CNC Robot deburr and wash
Was
h
LineRob
ot
Deb
urr
Wash
Line
Secondary OperationsLaser etching + inspection
Laser
Inspecti
on
Logo
Asse
mbly
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Material/mechanical properties
Magnesium
• Cost: $2.10/lb.
• Strength:
• Density:
• Specific strength: 158 kN*m/kg
• Embodied energy:
• Specific energy:
Aluminum
• Cost: $0.72/lb.
• Strength:
• Density:
• Specific strength: 115 kN*m/kg
• Embodied energy:
• Specific energy:
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Laptop Top Cover Mfg ProcessStarting Weight: 1165 g Final Weight: 115 gMaterial Waste: 90.1%
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Laptop Top Cover Cost Breakdown
Top Cover Process StepsProjected
Yield %
Raw Material Billet (Mg) 100%
CNC Milling 92%
Deburr 99%
Cleaning 99%
Anti-corrosion Treatment 98%
Painting 90%
Secondary Operations 99%
Logo Subassembly 98%
Packing and Logistics /
TOTAL 77%
Top Cover Cost Structure
Total Cost: $33.73Material + Machining: $18.21
Cost (w/ defect): $43.80
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Laptop Keyset Cover Mfg ProcessStarting Weight: 1225 g Final Weight: 176 gMaterial Waste: 85.6%
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Laptop Keyset Cover Cost Breakdown
Keyset Process StepsProjected
Yield %
Raw Material Billet (Mg) 100%
CNC Milling 91%
Deburr 99%
Cleaning 99%
Anti-corrosion Treatment 98%
Painting 90%
Secondary Operations 96%
Packing and Logistics /
TOTAL 75%
Keyset Cost Structure
Total Cost: $37.80Material + Machining: $21.55
Cost (w/ defect): $50.40
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Budget Issues• Retail Cost: $1000 (assuming 50% markup to customer)
• Wholesale Cost: $500 (assuming 50% markup to Best Buy)
• Cost out the door: $250 (all-in cost)
• Laptop cover + Keyboard cover: $43.80 + $50.40 = $94.20
• …
• Max budget for the rest of the computer: $155.80
• Already burned ~40% of the budget on two parts of the BOM
• Think about how many computers they make and sell (1M/year)
• Production rate also becomes an issue, at 90 minutes on the CNC per part, this would mean they would have to buy >100 CNC’s and run 24/7
• Total disaster: Laptop discontinued
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This is a long time for each part to be on the CNC!
The interior finishing and vents make up ~70%
Look at all the tool changes
So many side vent holes
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Just these 5 features make up 25% of the of the total CNC timeHow important are those, really?
This design is in big trouble, not even that much opportunity for cycle time reduction, only 10-15 minutes each
What about material savings? Or energy savings?
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Takeaways
• Design + Engineering + Marketing + Management
• Build a process plan before making decisions
• Think about both cost as well as production rate issues
• Consider sensitivities as well as opportunities for cost optimization
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Poly board pre-cast concrete
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BAAM pre-cast concrete mold
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What if the tool was ½ or ¼ of the size?
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What if material rates for plastic doubled/tripled?
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What if labor costs decreased by ¼?
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Summary
• The additional benefits of the technique will always maintain
• Shipping costs ½ for long hauls
• Higher qty, getting 4 parts for every 3 of the lay-up method
• Every part will be different (size, material) but immune to labor changes
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Mat: $24.65Tool:Prod:
Mat: $1.38Tool:Prod:
Mat: $95.37Tool:Prod:
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Mat: $6.84Tool:Prod:
Mat: $0.52Tool:Prod:
Mat: $0.99Tool:Prod:
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Mat: $2.48Tool:Prod:
Mat: $0.14Tool:Prod:
Mat: $0.37Tool:Prod:
Mat: $25.05Tool:Prod:
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Mat: $0.24Tool:Prod:
Mat: $242.97Tool:Prod:
Mat: $0.14Tool:Prod:
Mat: $242.97Tool:Prod:
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Mat: $2.37Tool:Prod:
Mat: $0.29Tool:Prod:
Mat: $4.20Tool:Prod:
Mat: $7.80Tool:Prod:
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Mat: $1.19Tool:Prod:
Mat: $7.20Tool:Prod:
Mat: $3.48Tool:Prod:
Mat: $263.90Tool:Prod:
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Mat: $7.82Tool:Prod:
Mat: $0.37Tool:Prod:
Mat: $7.82Tool:Prod:
Mat: $16.69Tool:Prod:
![Page 53: 2.810 Cost Adventureweb.mit.edu/2.810/www/files/lectures/lec20-cost-2019.pdfBudget Issues •Retail Cost: $1000 (assuming 50% markup to customer) •Wholesale Cost: $500 (assuming](https://reader033.vdocuments.us/reader033/viewer/2022051813/603243362a73014b2332a205/html5/thumbnails/53.jpg)
Mat: $1.15Tool:Prod:
Mat: $22.38Tool:Prod:
Mat: $31.20Tool:Prod:
Mat: $2.45Tool:Prod: