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Cost per Flying Hour (CPFH) Metric Is Multidimensional and Used by DoD in Different Ways

• CPFH is a metric widely used by the military services for different purposes, such as for flying-hour programs (FHP), for flying-hour reimbursable billing rates, and to compare O&S costs of different aircraft programs.
• The key difference between CPFH used for FHP and reimbursable billing and the CPFH used to compare O&S costs of different aircraft programs is that cross-system O&S comparisons intentionally include some categories that are fixed (i.e., do not vary with flying hours).

O&S Cost per Aircraft Is Alternative Affordability Metric to CPFH in Comparing O&S Costs of Different Aircraft

• The CPFH metric can behave counterintuitively: When flying hours are reduced, total program costs are reduced, but cost per flight hour can increase.
• Decisionmakers could use CPFH to compare O&S costs of different aircraft when the appropriate standardization steps mentioned in the report are taken.
• Comparisons of CPFH are most appropriate when the intention is to compare costs that vary closely with flying hours, such as fuel, depot-level reparables, or perhaps engine-related costs.
• O&S costs will include elements that are largely fixed or insensitive to changes in flying hours — such as unit-level personnel, sustaining support, or modifications.