# ClothesWasher Manufacturing Costs Data Gathering, Reporting and Statistical Treatment ClothesWasher Workshop March 11-12, 1998 

# EE

U.S. Departmentof Energy Office of Energy Efficiency and Renewable Energy 1000 IndependenceAvenue, SW Washington, DC 20585

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# ClothesWasherWorkshop: AHAM Data Collection 

# Introduction

Data collection methodology Illustrative manufacturing cost submittals UncertaintyNariability Industry cost distribution Cost-efficiency graph Appendix: AHAM Data Submittal

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# ClothesWasherWorkshop: AHAM Data Collection 

# Data Collection Methodology**--~-·** j j 

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# Baseline MEFvalue (MEF

# =0.817) was established. DOE provided AHAM with more specific definitions of the cost categories outlined in the survey instrument. Data was submitted to AHAM by the manufacturers

- Manufacturers provided a range of costs associated with achieving each efficiency level. Ranges were provided separately forvariable and fixed costs.

- Ranges are described by triangular distributions with minimum, most likely and maximum values. AOL developed a spreadsheetto aggregate manufacturers' cost distributions at each efficiency level.

-**Shipm~nt-based** 

# weights were assigned to each distribution.

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# ClothesWasherWorkshop: AHAM Data Collection 

# Illustrative Cost Distributionsfor Incremental Manufacturing Costs as provided by different manufacturers

Incremental manufacturing costsfor Efficiency level "X"

ManufacturerA 

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### 1 2 3 4 5 6 7 8 lncrem en ta I Cost($)



### Manufacturer B 

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### 1 2 3 4 5 6 7 8 Inc rem en ta I Cost($)



### Manufacturer C

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### 4 5 6 7 8 Inc rem en ta I Cost($)



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# Clothes WasherWorkshop: AHAM Data Reporting 

# Characterizing Uncertaintyand Variability in Manufacturing Costs**,~,** \ \**;~**.. _.)

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# Samples were drawn from manufacturer distributions to create an industry distribution at each efficiency level.
Results are reported as distributions over entire range of costs and for all efficiency levels.
Incremental costs are reported for different percentile levels 

# (0°/o, 10°/o, 25°/o, 50°/o, 75°/o, 90o/o, 100°/o).
A shipment weighted average of most likely costs was also reported as a point value of incremental cost.

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# ClothesWasherWorkshop: AHAM Data Reporting 

# Incremental Manufacturing Costs represented using Probability Distribution

Efficiency LevelX

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## 1.00 ManufacturerA Manufacturer B

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# Total Rel. Probability 

# = 1.0

2.75 4.50 6.24 8.00 

# Incremental Cost ($) 6

# ClothesWasherWorkshop: AHAM Data Reporting 

# A cost-efficiency graph was developed usingthe industrycost distribution (represented as percentilevalues) for each efficiency level

ManufacturerA



## 0 1 2 

## 3 4 

## 5 6 

## 7 8 Incremental Cost ($) 

# Cost-Efficiency Graph
Iner. Manufacturing 

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## Percentile (I) 

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## 90% 

## $ LevelX


## 100% 

## $ Efficiency (MEF}

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# ClothesWasherWorkshop: AHAM Data Reporting 

# AHAM data submittal was used todevelop acost-efficiency graph

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# Clothes Washer Workshop: AHAM Data Reporting 

# Shipmentweighted average ofthe most likelyvalues and the 50th percentilevalue are differentconcepts

Efficiency Level1



# 0Manufacturer Manufacturer Manufacturer Manufacturer 

# A B 

# C D



# 1 2 

# 3 

# 4 5 6 7 

# 8 9 10 Incremental Cost($)

Manuf- Mkt. Cost Most SWAof SOth acturer Share Range Likely Most 

## likely Percentile 

## A 25% $0-2 $1 

## B 25% $2-4 $3 

# c 25% $6-8 $7 

# $5.0 $4.0

D 25% $8-10 $9 

# The shipmentweighted average of most likely isthe only single data point that always incorporates datafrom all manufacturers.

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# Clothes Washer Workshop: Appendix

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# Appendix: AHAM Data Submittal

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### AHAM Data Submittal-Productcharacteristics and energy use data ApplianceType: ClothesWasher Appliance Class (anticipated): Standard(1.6 cu. ft.or greatercapacity) YearlyProductionVolume (a)=7,065,761 units
ProductCharacterisics Energy Use (c) WaterUse (c) Percent MEF TotalEnergy Clothes Hot Machine Dryer Water Improvement w/dryer Container(c) Water(d) Energy (e) Energy Use (b) cu.ft./kWh/cycle kWh/cycle cu.ft. kWh/cycle kWh/cycle kWh/cycle gal.lcyc (!] [2] [3] [4] [5] [6] [7] [8] Baseline 0.817 3.227 2.847 1.587 0.209 1.43 39.181 5 0.860 3.165 2.817 1.543 0.209 1.413 38.613 10 0.908 3.017 2.822 1.408 0.209 1.4 38.613 15 0.961 2.833 2.832 1.216 0.209 1.407 38.621 20 1.021 2.739 2.893 1.113 0.218 1.408 38.446 25 1.089 2.292 2.866 0.715 0.304 1.273 26.6
35 1.257 1.866 2.749 0.462 0.133 1.27 21.03 40 1.362 1.859 2.749 0.462 0.133 1.263 21.03 45 1.485 .1.651 2.736 0.429 0.114 1.107 23.405 50 1.634 1.574 2.736 0.413 0.114 1.047 23.405
(a) Total shipments ofclothes washers made during 1996forthe U.S. domestic market. [2] Referto Section 4.4, MEF, DOE Test Procedures1• Baseline MEF value provided byAHAM New MEF =Baseline MEF 

### I {1

- (percent improvement/100)} (3] Sum of ETE and DE; where ETE is from Section 4.1.7 and DE is from Section 4.3 of DOE Test Procedures. 1 [4] Referto Section 3.1, C, DOETest Procedures. 1 [5] Refer to Section 4.1.3, HET, DOE Test Procedures. 1 Includes only externally applied hotwater. [6] Referto Section 4.1.6, MET, DOE Test Procedures. 1 Includes internal hot water. [7] Referto Section 4.3, DE, DOE Test Procedures. 1 [8] Referto Section 4.2.2, QT, DOE Test Procedures. 1 (9] Refer to Section 4.2.3, WCF, DOE Test Procedures. 1

1 Clothes WasherTest Procedure titled "Uniform Test Method for Measuring the Energy

Consumption of Automatic and Semi-Automatic Clothes Washers." All are part of Appendix J1 to Subpart B of Part 430. Water Use gal.I cu.ft. [9] 13.779 13.732 13.71 13.67 13.342 9.22
7.661 7.661 8.57 8.57 

# ..

### AHAM Data Submittal-Shipmentweighted average of most likely values
ApplianceType: ClothesWasher Appliance Class (anticipated): Standard (1.6 cu. ft.or greatercapacity) DataCharacteristic: ShipmentWeightedAverageofMostLikely YearlyProductionVolume (a)=7,065,761 units
ProductCharacterisics VariableCosts Total Total Incremen. No. of Percent MEF CostPerUnit (a) Variable Fixed Mfg.Cost Respondents Improvement Materials Labor Overhead Costs (j) Costs (o) (p) (b) cu.ft.lkWh/cycle (g) (h) (i) ($perUnit) ($perUnit) ($perUnit) ($perUnit) [I] [2] [12] [13] [14] [15] [22] [23] Baseline 

### 0.817 5 0.860 $0.01 $0.01 $0.00 $0.02 $0.07 $0.09 10 0.908 $0.25 $0.04 $0.01 $0.30 $0.61 $0.91 15 0.961 $3.18 $0.10 $0.04 $3.32 $1.01 $4.33 20 

### 1.021 $10.71 ($0.02) ($1.80) $8.89 $6.21 $15.10 25 1.089 $36.14 $8.61 $0.09 $44.84 $19.29 $64.13
35 1.257 $86.73 $10.94 $7.78 $105.45 $22.72 $128.17 40 1.362 $87.15 $10.94 $7.78 $105.87 $22.72 $128.59 45 1.485 $125.58 $15.52 $14.51 $155.61 $24.67 $180.28 50 1.634 $132.40 $15.68 $14.51 $162.59 $24.67 $187.26

[12] Material costs are those costs associated with the purchase of all materials required in the manufacturer's production process. Accordingly, material costs include not onlythe cost of the material in the finished component, but also that of the material scrapped (because of material removed orscrapped components) minus salvage price. Estimates of direct material costs accountfor all raw materials and purchased finished supplier partsthat are directly assignable to the end product. [13] Labor costs include all direct costs that are physically traceable to the end product, plus any overtime premium. Labor costs are determined as an average wage rate, depending on worker classification,

.required to perform the tasks resulting in the end product. Total labor cost per unit is a summation of costs taken over all tasks or operations required in the production process. [14] Overhead includesfactory overhead excluding depreciation. Includes both direct and indirect components. Direct overhead costs are the estimated overhead charges that attemptto accountfor all other expenses that are due to the production process, vary directlywith the production volume, and contribute to the cost of sales. Examples of such expenses include, but are not limited to, expendabletools, material handling support, fuel and power requirements, set up costs, freight in and out, costs of direct supervision, and clerical costs. (The estimatedtotal of all expensesthatvary with the production quantity is based on thevolume of common or nearcommon components to be produced. The sum of these expenses is then apportioned to each component on some logical scheme.) Indirect overhead are comprised of, but not limited to, propertytaxes, insurance costs, etc. [15] Total of columns numbered [12] through [14]. [22) This isthe sum of investments fortooling costs, investment, R&D and marketing.

- Tooling cost is the total cost of special tooling to manufacture a component overthe entire life production

volume of that component. Tooling costs will be amortized over a period of 5years.

- Investment costs are those costs associated with the purchase of property, plant and equipment required

forthe manufacturer's production process. Investment costs will be amortized over a period of 5 years.

- R&D costs are costs incurredforthe purpose of designing and developing new and improved products,

orprocesses. R&D costs will be treated as an expense. 

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- Marketing costs are the expensable costs for new product advertisements, literature and catalogs, and various

related marketing expenses. Marketing costs include market research, advertising, point-of-sale promotions, and salespersons' compensations and travel costs. Marketing costs will be treated as an expense. [23) Per unitcosts (fixed) are obtained by dividing the total investment (as provided by the manufacturers) by the numberof clothes washers produced by those manufacturers.AHAM Data Submittal-Costdistribution represented as Percentiles ApplianceType: ClothesWasher ApplianceClass (anticipated): Standard (1.6 cu.ft.orgreatercapacity) DataCharacteristic: Percentiles YearlyProduction Volume (a)=7,065,761 units
ProductCharacterisics Total Total IncrementaJ Percent Percentile MEF Variable Fixed Manufacturing Improvement Costs(j) Costs(q) Costs (b) cu.**ftAWhlcycl~** ($perUnit) ($perUnit) ($pcrUnil)
Baseline 0.817 5 100 (Max.l 0.860 $0.24 $0.87 $1.11 90 $0.01 $0.18 $0.18 75 $0.01 $0.01 $0.02 50 $0.01 $0.01 $0.02 25 $0.01 $0.01 $0.02 IO $0.01 $0.01 $0.02 0 $0.00 $0.00 $0.00 10 100 (Max.l 0.908 $6.75 $I0.84 $12.84 90 $1.26 $1.09 $2.71 75 $0.49 $0.30 $0.96 50 $0.01 $0.06 $0.07 25 $0.01 $0.05 $0.06 IO $0.01 $0.01 $0.02 0 $0.00 $0.00 $0.00 15 100 (Max.) 0.961 $40.00 $I0.84 $46.19 90 $3.96 $4.36 $14.08 75 $0.76 $0.30 $0.97 50 $0.65 $0.15 $0.80 25 $0.58 $0.12 $0.72 IO $0.01 $0.01 $0.02 0 $0.00 $0.00 $0.00 20 100 IMax.l 1.021 $70.00 $20.60 $79.45 90 $27.78 $15.63 $38.48 75 $14.13 $11.75 $27.74 50 $0.72 $0.33 $1.06 25 $0.65 $0.26 $0.95 IO ($0.53) $0.24 $0.90 0 ($12.20)

. $0.21 $0.80 25 100 (Max.) 1.089 $83.28 $27.63 $I02.63 90 $70.40 $25.36 $93.97 75 $67.24 $24.04 $90.85 50 $63.46 $22.14 $86.26 25 $15.11 $14.39 $29.37 IO ($0.30) $14.07 $16.13 0 ($12.20) $4.85 $1.28 35 100 (Max.) 1.257 $280.00 $IOl.60 $381.60 90 $228.80 $25.28 $254.01 75 $118.63 $23.29 $143.34 50 $69.06 $21.41 $90.56 25 $63.59 $19.44 $85.30 IO $60.38 $17.20 $81.74 0 $52.03 $15.06 $67.43 40 IOOIMax.l 1.362 $290.00 $101.60 $391.60 90 $229.28 $25.28 $254.44 75 $117.17 $23.30 $143.57 50 $69.05 $21.41 $90.54 25 $63.73 $19.44 $85.28 IO $60.44 $17.15 $81.74 0 $52.03 $15.06 $67.43 45 100 IMax.l 1.485 $300.00 $IOl.60 $401.60 90 $239.76 $28.23 $266.26 75 $227.29 $23.70 $251.73 50 $128.38 $19.89 $153.71 25 $79.38 $18.02 $97.37 10 $69.25 $16.95 $87.36 0 $52.30 $15.06 $68.26 50 IOO(Max.) 1.634 $300.00 $IOl.60 $401.60 90 $239.46 $28.29 $266.11 75 $227.31 $23.76 $251.70 50 $132.89 $19.89 $157.87 25 $95.45 $18.00 $113.81 IO $84.95 $16.94 $102.98 0 $66.16 $15.06 $82.12