Cost Factors in CNC Manufacturing

CNC (Computer Numerical Control) machining is a cornerstone of modern manufacturing. It provides, precision, efficiency, and scalability. The application of CNC is applied across a broad spectrum of manufacturing markets from aerospace, space, automotive, medical devices and consumer electronics. There are several cost factors in CNC manufacturing that have a direct impact on delivered component cost. The factors listed below, encompass both direct and indirect costs, and give a good idea of what influences final price.

Machine Costs

Initial capital cost of CNC machines can be significant. CNC machine size can vary from desktop for very small work, to bridge style for machining large blocks of material. Size and complexity can have a significant impact of machine cost.  Capital cost can be proportionate with machine size. The larger the machine, the more expensive. There are exceptions to this depending on comparable levels of sophistication.

CNC machines offer different levels of capability and complexity. They can vary from 2 axis lathes to 12 axis multi-spindle turn/mills. The definition of material size to be machined, the level of complexity required and degree of tolerance, will determine the style of machine needed.

• Initial Capital Investment: Quality CNC machines are expensive. There is a large price range for initial equipment cost, They can vary from tens of thousands to millions of dollars. The initial costs of capital are always a consideration, but the real value of the expenditure is usually measured through ROI (Return on Investment) or ROA (Return on Asset). What can the CNC machine produce and at what rate of productivity?

• Maintenance: Calculating maintenance is necessary when factoring in “real” overall costs. The uptime of the CNC machine is critical for achieving maximum ROI/ROA.  It takes knowledge of the equipment and regularly scheduled maintenance to realize this result. Unplanned downtime and machine breakdowns can be devastating, causing poor quality, late deliveries and dissatisfied customers.

Labor Costs

Labor is another critical factor that impacts the overall cost in CNC manufacturing. In the USA many factors impact labor costs from regional labor cost structures to the availability of skilled labor. Regardless, factoring in labor costs is part of determining overall cost

• Skilled Workforce: CNC machining requires a high level of skilled workers. There are different functions to be carried out in a successful CNC machining operation: CNC operators, machinists, programmers, maintenance and engineering. Some of these jobs can be combined, depending on the size of shop and shop philosophy, but all require a high level of skill. Usually, the higher the level of skill and experience is proportionate to higher wages.
• Labor Efficiency: High labor costs can be offset by higher levels of efficiency. Operators with years of manufacturing experience can have considerable positive impact on production throughput. A seasoned well-trained operator, is in many instances capable of setting up and running multiple machines, optimizing machine programs, and minimizing waste, all of which play a critical role in reducing unit cost.

Material Costs

The type of raw material being used in CNC machining directly impacts the overall cost of production. Raw material costs vary widely. Another cost factor in calculating materials, is machinability. Not all materials machine the same.

• Different Raw Materials: Some of the more common materials used in machining are aluminum (many different grades), and cold roll steel. These have a lower raw material cost and are easier to machine. Moving up into more exotic materials: stainless steel, titanium or high-strength alloys, are more expensive and more difficult to machine. They can also add expense due to longer machine times and shortened tool life.

• Material Waste: In any machining, waste is always a consideration. Thanks to advances in CNC machine technology and modern adaptive controls, metal removal is optimized, and scrap is minimized. The controller and servo technology help the material being removed be more precise, and can repeat this process from part-to-part, making the finished parts more consistent

 Setup and Tooling Costs

All machining requires some level of setup, but CNC machines, properly configured and tooled can greatly reduce setup times and optimize spindle utilization, two factors that have real impact on overall cost.  Setting up the machine involves programming tool selection, tool loading, tooil touch-off, offset adjustments and test cutting.

• Setup Time: With manual equipment, the more complex the part, the longer the setup time, but CNC equipment can greatly help reduce setup time.  Many of the modern CNC machines have additional tool positions and ATC’s (Automatic Tool Changer). This gives machines tool redundancy, helping reduce setup from part-to-part and minimizes operator intervention. Also, many of these machines have in process gauging, giving the machine the ability to measure the part and make tool offsets, internal to the part program.
• Tooling Costs: CNC machines have very finite control capabilities for controlling size,  feeds and speeds. Consistent feed and speed control have a significant impact on tool life. Many of the more modern CNC machines have adaptive controls. This feature gives the CNC machine the ability to monitor tool pressures and part harmonics. The machine can then adjust the program to optimize tool cutting conditions. This feature helps reduce tooling cost while maximizing tool life.

Production Volume

The volume of parts being produced within a given setup, can significantly impact the part cost per unit. Due to economy of scale, generally, as production volume increases unit cost decreases, but with properly sized and tooled CNC machines, the disparity between low and high-volume unit cost can be reduced.

Low-Volume vs. High-Volume: For low-volume production, the per-unit cost tends to be higher because of the fixed costs associated with setup, tooling, and labor. The inverse is true for high-volume production. The per-unit cost is reduced as machines run larger lot sizes, better amortizing setup, spindle utilization and labor costs. However, with many modern CNC machines equipped with more turret positions, both mill and turn capabilities, ATC’s, automation and in process gaging, setups are greatly reduced, thus shrinking the difference in parts cost between low and high volume.

Conclusion

The keys to managing manufacturing costs require effective planning, investments in good equipment, a skilled workforce, knowledge and understanding of the manufacturing process and a strong management team. At Intrex Aerospace we are unswerving in our commitment to manufacturing excellence.

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