Cost Of PPAP - What is the average cost? Is there a Yearly cost?

gpainter

Quite Involved in Discussions
#1
We are getting into some Customers that require PPAP. Just a rough guess what is the average cost? I know that we will benefit in the end.
 
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Kevin Mader

One of THE Original Covers!
Staff member
Admin
#2
About a year back, I asked around some and determined that a Level 3 submission could run between $1400-$4400 dollars, dependent of course on availability of resources, who is tagged with doing it, etc.

Any help??

Kevin
 

ksanders

Involved In Discussions
#4
It depends on the customer. Some want every item in the AIAG table of contents in the package, while others will settle for limited documentation. Also, you have to be careful of the growing list of additional requirements coming from Tier 1 automotive suppliers who have decided that the AIAG requirements are not good enough for them and create a bunch of custom stuff for you to do in addition.

My recommendation is that you get a clear understanding as early as possible (kick-off meeting) of what the requirements are going to be. Get this in writing. If additional requirements come up later, you aren't left eating the cost.

I have some suppliers who have implemented a checklist that they have the customer sign as sort of a "Statement of PPAP Requirements".

In short, the real cost is in what you didn't know you were going to have to supply, and end up jumping through hoops to supply at the last minute.
 
N

noboxwine

#5
$ 2,500 baseline + an estimate for the following:

$ 50 / hr for CMM capability studies
$ 25 / hr for other capability studies
 
D

Duke Okes

#7
It will depend on:
- level of submission (of PPAP, not of your company being submissive to customer ... ha, ha)
- complexity of product (e.g., how much inspection required, technology/knowledge/skills to do it, number of special characteristics, whether it involves appearance items, ...)
- whether your customer uses PPAP appropriately (e.g., provides sufficient lead time, is really looking for product issues rather than nit-picky documentation issues)
 
Q

QualityBob

#8
Yes - PPAP has a cost, but do you charge for it - do you add it to your Quote?

I guess I was raised “Old School,” we never charged for a PPAP, just for the parts themselves (at a fair cost) – but also, we never did a PPAP on “spec.” We had to have a PO in Hand - usually for a substantial initial run at a minimum (300 pieces was typical). Of course this occurred well past the “Prototype” stage of APQP.

Therefore, we ourselves would go elsewhere if anyone tried to charge us for a PPAP – as we knew our customer would also do to us.

I know for a fact that had we done any petty crap like – nickel and diming our Big OEM customer (in many cases they were GM and Ford) – with “PPAP” charges – we could have possibly gotten away with it once – but it would have soured our relationship with the “Buyers and SQEs that we dealt with mortally.

Someone previously said that PPAP costs are just a part of doing buisness - I agree. If you do have to "Cost" it someplace - throw it into R&D or Marketing.
 
Last edited by a moderator:
C

CDR007

#9
Where you able to determine an accurate costs of PPAP? I'm trying to understand the "cost drivers" of implementing PPAP. Does anyone have list of cost drivers??
 
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