Estimating Maintenance Costs for Royal Canadian Navy Ships – A Parametric Cost Model


  1. Bouayed, Z.
  2. Penney, C.E.
  3. Sokri, A.
  4. Yazbeck, T.
Corporate Authors
Defence Research and Development Canada, Centre for Operational Research and Analysis, Ottawa ON (CAN)
This paper proposes a parametric costing model for Defence planners to conduct a first order estimate of the maintenance component of O&S costs for ships being considered for procurement. The model is built based on a parametric approach which incorporates relevant cost drivers as input parameters. The coefficients of these cost factors are estimated by fitting the model with a historical dataset of Royal Canadian Navy ships through regression analysis. Once the coefficient values are obtained, the cost model is used to produce out-of-sample fitted values to estimate maintenance costs for both currently active vessels and those being considered for acquisition. The regression analysis returns highly significant explanatory variables, with an R-squared statistic of 0.875. The single most important factor in explaining yearly maintenance costs is the ship’s class. Additionally, the effect of an additional sea day per year is to increase yearly maintenance costs by 0.38%. An Excel-based costing tool is also provided in this paper for potential use by personnel working within the Centre for Costing in Defence to produce rough order of magnitude maintenance cost estimates.

Il y a un résumé en français ici.

Parametric Costing Model;In-Service Support costs;Regression Analysis
Report Number
DRDC-RDDC-2017-R147 — Scientific Report
Date of publication
01 Oct 2017
Number of Pages
Electronic Document(PDF);CD ROM

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