Using indirect cost multipliers to estimate the total cost of adding new technology in the automobile industry

International Journal of Production Economics

Volumn 124, Issue 2, 2010, Pages 360-368

  Rogozhin, Alex ^a   Gallaher, Michael ^a   Helfand, Gloria ^b   McManus, Walter ^c  

^a RTI INTERNATIONAL   (United States)

^b U S ENVIRONMENTAL PROTECTION AGENCY   (United States)

^c UNIVERSITY OF MICHIGAN   (United States)

Author keywords

Automotive; Cost analysis; Indirect costs; Multiplier; Retail price equivalent

Indexed keywords

AUTOMOBILE INDUSTRY; COST ANALYSIS; DIRECT COSTS; INDIRECT COSTS; NEW TECHNOLOGIES; PRODUCTION PROCESS; RETAIL PRICE; TOTAL COSTS;

COST ACCOUNTING; COSTS; FREQUENCY MULTIPLYING CIRCUITS; HARMONIC ANALYSIS; SALES;

COST BENEFIT ANALYSIS;

EID: 76049092127     PISSN: 09255273     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.ijpe.2009.11.031     Document Type: Article

References (22)

1. Brierley J.A., Cowton C.J., and Drury C. A comparison of product costing practices in discrete-part and assembly manufacturing and continuous production process manufacturing. International Journal of Production Economics 100 2 (2006) 314-321
2. Clark K.B., and Fujimoto T. Product Development Performance: Strategy, Organization, and Management in the World Auto Industry (1991), Harvard Business School Press, Boston, MA
3. Cooper R., and Kaplan R.S. How cost accounting distorts product costs. Management Accounting 69 10 (1988) 20-27
4. Griffin A. The effect of project and process characteristics on product development cycle time. Journal of Marketing Research 34 1 (1997) 24-35
5. Helfand, G., Sherwood, T., 2009. Memorandum: documentation of the development of indirect cost multipliers for three automotive technologies. Office of Transportation and Air Quality, U.S. Environmental Protection Agency.
6. Henderson R.M., and Clark K.B. Architectural innovation: the reconfiguration of existing product technologies and the failure of established firms. Administrative Science Quarterly 35 1 (1990) 9-30
7. International Organization of Motor Vehicle Manufacturers (OICA), 2008. World motor vehicle production. Available at: 〈http://oica.net/wp-content/uploads/world-ranking-2007.pdf〉. Paris, France: International Organization of Motor Vehicle Manufacturers (OICA).
8. Jack Faucett Associates, September 4, 1985. Update of EPA's motor vehicle emission control equipment retail price equivalent (RPE) calculation formula. Jack Faucett Associates, Chevy Chase, MD.
9. McKinsey & Company, October 2003. Preface to the auto sector cases. In: New Horizons: Multinational Company Investment in Developing Economies. San Francisco, CA.
10. National Research Council (NRC), 2002. Technologies for improving the fuel economy of passenger cars and light-duty trucks. Available at: 〈http://books.nap.edu/openbook.php?isbn=0309076013〉. Washington, DC: National Research Council. (accessed on December 8, 2008).
11. Niazi A., Dai J., Balabani S., and Seneviratne L. A new overhead estimation methodology: a case study in an electrical engineering company. Proceedings of the Institution of Mechanical Engineers, Part B: Journal of Engineering Manufacture 221 4 (2007) 699-710
12. Niazi A., Dai J.S., Balabani S., and Seneviratne L. Product cost estimation: technique classification and methodology review. Journal of Manufacturing Science and Engineering 128 2 (2006) 563-575
13. Ricardo, Inc., June 2008. A study of potential effectiveness of carbon dioxide reducing vehicle technologies, revised final report. EPA420-R-08-004a. Available at 〈http://www.epa.gov/oms/technology/420r08004a.pdf〉 (accessed on February 17, 2009). Environmental Protection Agency, Washington, DC.
14. Rogozhin, A., Gallaher, M., McManus, W., February 2009. Automobile industry retail price equivalent and indirect cost multipliers. EPA-420-R-09-003. Available at: 〈http://www.epa.gov/otaq/ld-hwy/420r09003.pdf〉. Washington, DC: Environmental Protection Agency.
15. Sierra Research, Inc., November 21, 2007. Study of industry-average mark-up factors used to estimate changes in retail price equivalent (RPE) for automotive fuel economy and emissions control systems. Sierra Research, Inc., Sacramento, CA
16. Son Y.K. A cost estimation model for advanced manufacturing systems. International Journal of Production Research 29 3 (1991) 441-452
17. Spinney, B., Faigin, B., Bowie, N., Kratzke, S., 1998. Advanced air bag systems cost, weight, and lead time analysis. Summary report. Contract no. DTNH22-96-0-12003. Department of Transportation, Washington, DC.
18. U.S. Department of Energy (DOE), 2008. Alternative and advanced vehicles: low rolling resistance tires. Available at: 〈http://www.afdc.energy.gov/afdc/vehicles/fuel_economy_tires_light.html〉. Department of Energy, Washington, DC.
19. U.S. Environmental Protection Agency (EPA), 2004. Final regulatory analysis: control of emissions from nonroad diesel engines, EPA420-R-04-007. Available at: 〈http://www.epa.gov/nonroad-diesel/2004fr/420r04007.pdf〉. Ann Arbor, MI: Environmental Protection Agency.
20. U.S. Environmental Protection Agency (EPA), 2008. Regulatory impact analysis: control of emissions of air pollution from locomotive engines and marine compression ignition engines less than 30 liters per cylinder, EPA420-R-08-001a. Available at: 〈http://www.epa.gov/otaq/regs/nonroad/420r08001a.pdf〉. Ann Arbor, MI: Environmental Protection Agency.
21. U.S. Internal Revenue Service (IRS), August 11, 2008. Amortization of R&D expenditures. Available at 〈http://www.irs.gov/businesses/small/industries/article/0,id=97642,00.html〉 (accessed on August 20, 2009). Internal Revenue Service, Washington, DC.
22. Vyas, A., Santini, D., Cuenca, R., April 2000. Comparison of indirect cost multipliers for manufacturing. Argonne, IL: Center for Transportation Research, Energy Systems Division, Argonne National Laboratory.