Cost Engineering is the application of scientific principles and techniques in order to estimate the variable costs and investments in the manufacturing of a product and of every of its components. The information resulting from the analysis are then particularly useful in the phases of budget planning, of monitoring and control of the production and of decision and profit analysis.
We offer Cost Engineering services for:
- Investments and Variable Costs analysis: starting from one industrial design or one component, we can estimate it in terms of cost and investment. The results of our evaluations are used primarily as inputs to budgeting, the project planning or to make decisions;
- Monitoring and Cost Control: the process used in monitoring capital expenditures and services in terms of project progress, to quantify variations from authorized budget and to allow effective actions to minimize costs;
- Cost Engineering System Development
We perform analysis for different areas, such as automotive, commercial and industrial vehicles, home appliances, environment. We also carry out appropriate and specific training at customer sites.
Our experience in the automotive market led us to provide services in both Cost Engineering branches: Vehicle Cost Engineering (VCE) and System Cost Engineering (SCIE).
Vehicle Cost Engineering (VCE) is responsible for the integration of the variable costs and investment of a vehicle, from the phase of Program Approval to the end of the life cycle of the product.
The main VCE’s tasks are:
- To integrate and verify the pre-assessments of variable costs and investment made by the Cost Engineering System before Program Approval;
- To prepare and show the synthesis of the variable costs and investments of the vehicle and the comparison with the cars of reference, supporting in this way the ideation and approval of new setting initiatives (Benchmarking);
- To manage the evolution of variable costs and investments in accordance with the evolution of the product from Program Approval to market launch;
- To support the purchasing team in the phase of definition of target costs;
To oversee the control of variable costs and investments
System Cost Engineering (SCIE)is the responsible for the evaluation of variable costs and investments of any vehicle’s component or system during the vehicle’s life cycle.
In fact SCIE’s aim is to monitor and control the two phases of: product setting and product development or use.
In the first one SCIE’s responsibilities are:
- To estimate costs in absence of drawings and math, with a product’s description of its technical and technological characteristics or by analysing the differences from other components;
- To compare the economic impact of several alternative solutions, even with low level of detail available.
In the second phase the main task of SCE is:
- To define the target costs for sourcing in the development phase and to verify the correspondence between contents and comparable components’ costs in order to identify the points of possible intervention of cost reduction and to quickly evaluate the costs of modifications.