It is essential to know the cost of a weld to make manufacturing decisions. An understanding of welding economics and the value added by technology will allow companies to compete successfully in domestic and global markets. Yet few companies look at, let alone understand all their costs. Most manufacturers lack an understanding of how much they are spending, what they are spending it on, or why. Understanding these costs allows a company to manage them and become more profitable. Let’s look at several of the variables that affect per piece or per weld cost. Equipment, labor, materials, energy, and other overhead affect cost.
Production Cost
Total welding costs incurred should include time spent preparing a joint, blasting, removing oils, assembly, preheating, tack-up, positioning, welding, slag removal, spatter removal, inspection, changing electrodes, transportation times, machine setup times, repair, and rework. Material costs include electrodes, shielding material, electric power, and gas for preheating.
Production rates and whether the weld will need to be replicated factor into manufacturing decisions. Robotic or automated welding may have a considerably higher equipment cost but are ideal for high production. An accurate understanding of current operating costs will allow for a comparison of manufacturing options. A company can consider how changing a welding process will affect overall costs. Savings that accrue with automation may justify enough of a return on the initial capital investment of more costly equipment.
Labor Cost
You may have noticed that the list of total production costs primarily consist of time. Labor cost depends on the rate of welding, hourly wages, and total operation time. Handling is additional. A larger percentage of Manual welding costs will be labor. Cost-saving tactics focus on minimizing operation time. Welding that can be done at a high rate of speed is preferred. Robotics and automation can reduce labor costs, but incur more set up and higher equipment costs. Automation and robotics is most beneficial in resistance spot welding. It is common in the automotive industry. The robot holds the material and welds. As technology advances arc welding is becoming more popular.
When calculating labor costs, some choose to divide time into value-added time and total hours worked. Unless the arc is struck, the joining process is not taking place. The ratio of hours spent welding to total hours worked is referred to as the operating factor. Operating factors are often expressed as a percentage. For costing purposes, decimal form should be used.
Material Cost
Material cost includes base and filler material as well as gases. Energy costs based on arc time and welding power draw will vary, but is usually a single digit percentage of the total welding cost. Material costs increase when special weld properties are needed for specific applications.
Overhead Costs
Overhead costs are often added to labor costs. Overhead can include plant, equipment, supervision, and indirect labor (office personnel). The formula for calculating total welding costs is: welding costs = labor and overhead (L&OH) + consumables (materials).
Costing Approaches
Welding costs are usually expressed as cost per unit, length, or weight. Cost per unit is effective for repeated processes done at an individual workstation. Time, the key cost, is measured directly. Cost per length is good for long single-pass welds. Time is calculated largely by travel speed. Cost per weight is easy to calculate, but it is best for applications that require significant volumes of weld metal. It is best for multi-pass applications, hard-facing, and overlay welding. Time is captured by deposition rate (pounds per hour). It does not work well for single pass, small, or short welds.
Future Developments
Robotics is being studied to improve the feasibility of welding dissimilar materials. New welding processes are being explored. Friction stir, magnetic pulse, conductive heat seam, and laser-hybrid welding are all being examined. The practicality of laser beam welding is being tested specifically for aerospace and automotive industry applications. Researchers are investigating the variables and unpredictable properties of welds. Microstructure, residual stresses, cracks, deformations, and other weaknesses are being investigated.