question Mythbusting CVRT prices

[Mr.Dozer]

Hello Tankers!

 

Does anybody have an idea of the production or new costs of the CVRT family vehicles? I know there are many myths of how much they where for buying from factory. I heard myths from 100'000 to 750'00(???) in the 70's. What do you think or know about the costs and what would the prices to be compared to the todays GBP rating?

 

Any suggestions? :wow:

[sirhc]

My diesel Scimitar was rebuilt in 2008 and disposed of in 2011. The 'Gross Replacement Cost' on the Merlin report is £457198.85. We had a Sabre, 03FD10, which was rebuilt in 2001 and disposed of in 2004 and that had a replacement cost of £302986.08. As to what they were new, I think it's going to be more like £750,000. Look how much it cost to build the Scimitar 2s, £14million, and they used a stripped Scimitar for most of the bits!

[RattlesnakeBob]

OK...:cool2: call me stupid but....what is it in one of them that costs SO much?

I mean surely we would all generally look at maybe an Aston Martin at £200,000 and say something like

"Lovely but..jeeeez! how much !?!?!?!"

and in one of them you have a 'hand assembled/ balanced etc' motor and running gear etc...also a hand assembled body and chassis etc .....loads of leather..lots of other nice shiny bits...which all adds up to a fair few man hours....plus I guess a handsome profit on each unit for the manufacturer...

I'm guessing an armoured fighting vehicle is built in much the same way... so... is it just the assembly time on them??... or is the actual steel/armour very expensive??... and/or... is it the 'gizmos' that fit such a vehicle out that make the final figure so high ???.....just wondering because £750,000 for a relatively small vehicle is a staggering amount ....isn't it?????

or...putting on my 'Mr Cynical' head. ..is it a bit of the old

" well....we're being asked to price for a new fighting machine and we can more or less set the price where we want to cos the MoD will pay ' attitude / pricing policy at work ???

Edited June 26, 2013 by RattlesnakeBob

[andym]

OK...:cool2: call me stupid but....what is it in one of them that costs SO much?

 

 

There's a distinct difference between the assembly cost of the individual vehicle and the all-up cost including the original design and testing, so you need to understand exactly what anyone means when they give a "cost".

 

There's also the argument that MOD doesn't help itself by setting odd standards and requirements that don't necessarily increase the value of the vehicle, although they do affect the cost. Many years ago the MOD decided to do an experiment by putting a frigate out to refit in a commercial shipyard. There was an article in a MOD magazine where they told the story of a windscreen wiper blade. The yard rang the manufacturer of the blades and got a quote for price and delivery. A couple of hours later the manufacturer rang back and said "We're confused - that part number is for a blade used by MOD". The shipyard confirmed that's what it was for, whereupon the manufacturer gave a revised quote with increased price and delivery figures. This was quoted as an example of how suppliers inflated costs when dealing with the MOD. In the next issue of the magazine there was a letter from the wiper blade manufacturer, who said that if the MOD were prepared to have exactly the same blade supplied to commercial standards then they'd hold to the original quote. On the other hand if they wanted all the certification, paperwork, packing and other stuff that MOD specified, then MOD would have to pay for it!

 

Andy

 

Andy

Edited June 26, 2013 by andym

[N.O.S.]

And it probably costs far more to inspect each component for compliance and give it the official stamp than it does to machine it in the first place (a bit like the aerospace industry?).

[Grasshopper]

And it probably costs far more to inspect each component for compliance and give it the official stamp than it does to machine it in the first place (a bit like the aerospace industry?).

 

Its the same on the railway! As an example we recently carried out a mod to fit door P.I.R sensors (them what are supposed to make the gangway doors open when you approach them instead of having to press a button which is apparently too difficult for people to work out) and the quote from a major (railway approved) stockist and train builder was over £400 per sensor. We went direct to the sensor manufacturer and they were a little over £40 per sensor.

[GeePig]

When I was an engineer I found that the major problem was education, which tends to endow people with the belief that there is a perfect answer, and a due method to arrive at it. The problem is that the future has not been mapped, hence there are no answers yet, nor due processes, for the things that need to be done in a new way.

 

As a result most of my triumphs from that period involved listening to people describe what they plan to do, and then discouraging them from doing most of it as being the least likely way to achieve anything new.

[RattlesnakeBob]

There's a distinct difference between the assembly cost of the individual vehicle and the all-up cost including the original design and testing, so you need to understand exactly what anyone means when they give a "cost".

 

 

 

Andy

 

Andy

Don't the manufacturers bear the cost of the development of the product though ? Surely that 'cost' shouldn't be passed on to the final buyer (the MoD) ?.....

After all...there would be a veritable queue of companies lining up to offer goods of all descriptions to the MoD if they were told the MoD were going to pay the entire development /prototype / experimental costs ??? ..

...heck....come to think of it...I'd offer to tender for something if that was the case ???..

now then :cool2:..what can I build in my shed ?? :cool2:

[sirhc]

Don't the manufacturers bear the cost of the development of the product though ? Surely that 'cost' shouldn't be passed on to the final buyer (the MoD) ?.....

After all...there would be a veritable queue of companies lining up to offer goods of all descriptions to the MoD if they were told the MoD were going to pay the entire development /prototype / experimental costs ??? ..

...heck....come to think of it...I'd offer to tender for something if that was the case ???..

now then :cool2:..what can I build in my shed ?? :cool2:

 

Any product you buy from any manufacturer has had significant development work carried out to produce it. If your products are high volume then the cost of development spread over the number of products is small. If you are spending millions of pounds designing and developing an armoured vehicle and only a small number get made, then you would either want the customer to pay up front or the % of development cost in each vehicle price would be higher.

 

When we are talking about CVRTs you have to remember how small the numbers produced for the MoD are... 350 Scimitars, 300 Scorpions, 136 Sabres, 89 Strikers, only about 50 Samaritans etc

[Sidewinder]

A lot of manufacturers pass on the development costs in some way or another to their customers. I work for an engine manufacturer and all of our suppliers pass on start up costs for producing parts onto us, whether that is us paying for tooling directly or adding the cost of development to the individual piece part price.

 

Things like this will work on economies of scale.. car manufacturers will add development costs to car prices, but because of the large volumes they sell it adds little to individual car prices, whereas MOD suppliers tend to sell fewer vehicles to spread the development costs over. Not saying its the only reason for the extortionate prices, but it probably goes a long way to explaining them.

 

James

 

Edited to say posted at the same time as Chris!

[timbo]

Its the same on the railway! As an example we recently carried out a mod to fit door P.I.R sensors (them what are supposed to make the gangway doors open when you approach them instead of having to press a button which is apparently too difficult for people to work out) and the quote from a major (railway approved) stockist and train builder was over £400 per sensor. We went direct to the sensor manufacturer and they were a little over £40 per sensor.

 

Amen to that Vince, but I think it is even more of a con on the railway as the quality of components doesn't seem to be anything like as high as the MOD stuff... As I work in finance on the railways it drives me even more nuts!!

 

Tim

[Grasshopper]

What I find frustrating (from an engineering perspective) is that simple ideas to improve things become "simply" unaffordable!

[GeePig]

What I find frustrating (from an engineering perspective) is that simple ideas to improve things become "simply" unaffordable!

 

A simple change could lead to costly retesting, because if the change were that good that it was worth doing then it must require all the things it affects to be retested as well. Suggesting simple changes later hence is often not a good career move, unless it can recover the project after it has careered off its own path.

 

trevor

[paulob1]

due to the nil DOD demand of the armed forces, all components /items have to be checked and tested, no exceptions...this in itself can multiply the cost of a component by many times...in all general industrial practices batch testing is accepted...this cannot be the case for indicvidually wrapped items that may not be used for 10 years, but must work when they leave the box....

 

It isnt just about the quality of the work it is a lot about the anciliary bits and pieces around the product...

 

an aston martin is cheap for the work that goes into it. Aston make little profit per car, and struggle to bring out new models...costs to develop are so high and technology is not cheap, not anymore...although once items are mass produced prices can fall significantly but then the same issues apply...one on one testing of every item...

[RattlesnakeBob]

yep I guess with a limited production run you could expect the manufacturers to want to recover the development costs etc ...

Pricing has always been a very dark art though..

I recall many years ago a mate at that time did a lot of development work on the first Landrover Discoverys.......

He and many others in the various teams were very confident that they would come onto the market at a price significantly below their major competitors at that time (Toyota /Nissan / Misubishi etc). but....when the Discovery finally came out , ...it was actually priced quite a bit higher....baffling ???? well ...maybe...read on...

the explanation as given to him was quite complex but in a way , understandable.. ..

Landrover surmised that most folk actually really wanted to own a Landrover product (because of the 'image' etc I guess)... but were only buying the Japanese products because they were 'cheaper'...(not because they were perhaps significantly better ...but that's another story )....

So...

......if you were to simply price your new Landrover below the competition?..then it might be assumed that people would feel " ooohhh it is cheaper but... perhaps it's not as good??? "..

So the powers that be at Landrover deliberately pitched the price above the competition relying on the idea that most folk in the market for such a new vehicle would be able to find a few more quid to have the satisfaction of being able to say to their mates..

" No !... I didn't have one of them (cheap) Jap things...I've bought a Landrover ! ..yeah, sure! ... it was a few more quid but it's a Landrover ain't it!.."

 

NB: I don't have a clue if this policy worked or not.....I wouldn't have thought it did because in my experience the first Discovery's were pretty dire when compared to Nissan Patrols , Mitsubishi Shoguns or Toyota Landcruisers .........