EVALUATING WELDING COSTS

The Basic Cost Elements and where to

focus for controlling these costs

Peter Ullman
 Scope of Presentation

• Methodology for determining Welding

Cost

• Understand the Assumptions

• Focal points for Welding Cost Control and

Cost Reduction
 Elements of Welding Costs
• Labor & Overhead (85%)
▫ Direct labor
▫ Manufacturing overhead
▫ Depreciation, etc.
• Welding Consumables (13%)
▫ Electrode/Filler Metal
▫ Shielding material
• Electrical Power (2%)
 Labor & Overhead Cost

• Welding process and procedure used to

make the required weld
• Effective labor hours to make the weld
• Applicable labor and overhead rate
Deposition Rate: The time it takes to
deposit one pound of weld metal
Depends upon:
• Process
• Consumable
▫ Type, size

• Procedure Used
▫ Amps, volts, travel
 Within Each Process,
Deposition Rates Vary
• SMAW: Different coatings, positions

• FCAW: Different core materials, positions

• GMAW: Shielding gases, arc transfer (short

arc, spray, pulse)

• SAW: Flux design, twin wires, multiple

heads
 All Processes
• Higher current density—more deposit
(Amperage per cross-sectional area)

• Higher amps—more deposit

• Bigger wire—more current—more deposit

Time to Deposit 1Lb of Weld Metal
Amps Deposition Rate (lbs/hr) Hrs/lb deposited

1/8 EXX18 120 2.6 0.385

1/8 EXX18 160 2.8 0.357
1/8 EXX24 160 4.6 0.217
.045 FCAW 160 4.6 0.217
.045 FCAW 150 4.2 0.238
.045 FCAW 300 6.3 0.159
.045 GMAW(AR) 300 11.5 0.087
.045 GMAW (CO2) 300 9.0 0.111
3/32 FCAW 400 12.7 0.079
3/32 FCAW 450 15.0 0.067
3/32 EB3 (SAW) 450 11.4 0.088
1/8 EB3 (SAW) 450 9.9 0.101
5/32 EB3 (SAW) 600 14.7 0.068
Operating Factor: % of time the arc is on
• Change electrode • Preheat/Post
• Reposition heat/Interpass
• Chip slag • Joint preparation
• Grind • Tacking
• Electrode control • Handling
(moisture, etc.) • Personal time
 Typical Operating Factors
• (Manual) GTAW, SMAW: 30%
• (Semi-Automatic) GMAW, FCAW: 40%
• (Full Automatic) SAW, etc.: 50%
• Reduce 10% for Field Applications (i.e.
20%/30%/40%)
• Most Accurate: Measure or calculate your
own
▫ (lbs of weld)/(electrode deposition rate) per man
or group of men in a given time interval
▫ Arc Timer
 Labor & Overhead Cost - Time

• 1/(DR x OF) = Production hrs/lb

• Production hrs/lb x $LOH Rate/hr=$LOH/lb

DR: Deposition Rate at the procedure used

OF: Operating Factor (decimal)
$LOH: Direct Labor, Benefits, Overhead allocation
per hour
Time, Labor & Overhead Cost to Deposit
1 lb of Weldmetal (@$50/hr)

Deposition Rate (lbs/hr) O.F. hrs/lb $L&OH/lb

1/8 EXX18 2.6 0.30 1.282 64.10

.045 FCAW 4.6 0.40 0.543 27.17
.045 GMAW 11.5 0.40 0.217 10.87
3/32 FCAW 15.0 0.40 0.167 8.33
5/32 EB3 (SAW) 14.7 0.50 0.136 6.80
 Consumable Materials Cost

• Electrode Cost Per Pound

• Electrode Efficiency

• Gas Cost (Usually per ft3)

• Flux Cost Per Pound

Electrode Efficiency: % of Purchased
Filler Material that Becomes Weld metal

• SMAW: 65%-75% 70%

• SMAW w/ 2” Stub Loss: 55%-65%; 60%
• FCAW: 80%-90%; 85%
• GMAW: 90%-95%; 95%
• GTAW: 95% 95%
• SAW: 95%-99% 95%
 Electrode Cost Per Pound of Weld metal:
(1/Efficiency) x $Price/lb

•
Efficiency $Price/lb
$Price/lb $/lb
$/lbWeldmetal
Weldmetal

1/8 EXX18
E7018 0.60 1.57
3.50 2.617
5.833
.045 E71T-1
FCAW 0.85 1.94
4.00 2.282
4.706
.045.045E70S-6
GMAW(AR) 0.95 1.10
3.00 1.158
3.158
3/32 E70T-1
FCAW 0.85 1.62
2.95 1.906
3.471
5/32
5/32EB3EM(SAW)
12K 0.95 0.89
3.30 0.937
3.474
Cost of Shielding Materials Per Pound
of Weldmetal
• Gas: Hrs/lb x Flow Rate(ft3/hr) x $/ft3
• Flux: Recycle: 1 lb Flux to 1 lb Weldmetal
• Flux: No Recycle: 2 lb Flux to 1 lb WM
• Best Gas Cost: (Total $Gas)/(Total Wire)
Purchased in given period
• Best Flux Cost: (Total $Flux)/(Total Wire)
Purchased in given period
 Sample Shielding Material Costs
Shielding Material Consumption Rate $Price/unit $Cost Shielding/lb Deposit

1/8 EXX18 None N/A N/A 0.00

3 3
.045 FCAW Ar-75%/CO2-25% 30 ft /hr .07/ft 0.242
3 t3
.045 GMAW Ar-95%/CO2-5% 35 ft /hr .075/f 0.092
3. 3
3/32 FCAW CO2 40 ft hr 0.01/ft 0.012
5/32 WB3 (SAW) Flux 1 to 1 2.00/lb 2.000
 Total $Cost of 1 lb. of Weld metal

$L & OH $Electrode Cost $Shielding Cost Total Cost/lb Weldmetal

1/8 EXX18 64.10 5.833 0.000 69.93

.045 FCAW 27.17 4.706 0.242 32.12
.045 GMAW 10.87 3.158 0.092 14.12
3/32 FCAW 8.33 3.471 0.012 11.81
5/32 Eb3 (SAW) 6.80 3.474 2.000 12.27
Pounds of Weld Metal Per Ft of Joint
• A(in2) x 12in x .283 lbs/in3 = lbs/ft of
Joint
A = Cross section Area of Weld Joint
12 in. extends cubic inch volume to 1 foot
.283 is density of steel per cubic inch
• Use pre-calculated charts
 Cost and Time per Foot of Joint:
¾” Butt Weld (@.786 lbs/ft & ¾” Fillet @1.48 lbs/ft)
¾” Butt Weld ¾” Fillet Weld

Process Hrs/ft $Cost/ft Hrs/ft $Cost/ft

1/8”
1.01 $54.97 1.90 $103.50
Exx18
.045”
0.43 $25.25 0.80 $47.54
FCAW
.045”
0.17 $11.10 0.32 $20.90
GMAW
3/32”
0.13 $9.29 0.25 $17.49
FCAW
5/32”
0.11 $9.65 0.20 $18.17
SAW
 Disciplined Procedures
Effect of Using 10% Less Amps
Current Deposition Prod Incr. $LOH Incr. Cost & Time
(Amps) Rate Hrs/lb per lb Increase
(Lbs/hr) (40% OF) Deposited Percent
.045 160 4.6
FCAW

.045 144 4.0 .082 $4.00/lb 15.1%

FCAW Hrs/lb

3/32 450 15.0

FCAW

3/32 405 12.9 .027 $1.35/lb 16.2%

FCAW Hrs/lb
Disciplined Operating Factor: Effect of 6
minutes arc time/hr (Losing 10% Operating Factor)

Normal Increased $LOH/lb $LOH/lb

OF time Deposited
Prod. %
(Hrs/lb@
Hrs/Lb -10% O.F. Increase Increase

1/8
.30 1.28 0.64 hrs $32.00 50%
EXX18
.045
.40 0.54 0.19 hrs $ 9.50 35%
FCAW
.045
.40 0.22 0.07 hrs $ 3.50 32%
GMAW
3/32
.40 0.17 0.05 hrs $ 2.50 29%
FCAW
5/32
.50 0.14 0.03 hrs $ 1.50 21%
SAW
Keys to Lower Cost: Keep The Arc On
(Maximize Operating Factor)
• Reduce/Eliminate Non-Welding Tasks
▫ Weld Preparation and Cleaning
▫ Material handling and fixturing
• Position work/easy joint access
▫ Flat/horizontal joints where possible
▫ Minimize reaching, etc
• Reduce electrode change time
▫ Semi-automatic in place of stick
▫ Automate where possible
▫ Bulk wire packages
 Keys To Lower Costs:
Control Procedures
• Easy-to-Use Processes and Consumables
• Train operators and instill discipline
• Establish and Set optimum Welding
procedures for each job
• Welding Equipment Easy to Set, Maintain
Settings
• Monitor and Maintain set Procedures
 Keys to Lower Costs:
Make the Right Weld
• Proper Joint Design
▫ Responsible amount and size of welds
▫ Weld sequence to minimize distortion
▫ Joint accessibility
• Present the best joint
▫ Good fit-up
▫ Clean plate
• Do Not Over-Weld—Unnecessary Weld
metal costs money
Primary Key to Lower Cost: QUALITY!
Weld It Right The First Time!
• Specify and Purchase the right process and
consumables for the job
• Operator Training and Education
• Enforce your quality control processes
▫ Control of materials
▫ Control of Weld Procedures
• Anticipate obstacles and avoid them—This is
easy with the proper focus and discipline
• Catch mistakes early
 Summary and Conclusion
• Methodology of Cost per Pound of
Deposited Weld Metal
▫ Process + Procedures= Time
▫ Labor & Overhead
▫ Materials
• Effects of Key Variables on Cost
• Key Cost Focus
▫ Operating Factor
▫ Process and Procedures
▫ Quality
Typical Operating Factors
• (Manual) GTAW, SMAW: 30%
• (Semi-Automatic) GMAW, FCAW: 40%
• (Full Automatic) SAW, etc: 50%
• Reduce 10% for Field Applications (i.e.
20%/30%/40%)
• Most Accurate: Measure or calculate your
own: (lbs of weld)/(electrode deposition
rate) per man or group of men on a given
weld size with the same process and
procedure
Case History… Effect of Welding Wire

• Example (FCAW)
▫ 60% Efficient Cheap Wire @ $10/lb.
 Need 1.7 lbs to get 1.0 lb deposit
 Deposit cost = $17.00/lb.

▫ 90% Efficient Good Wire @ $14/lb.

 Purchase 1.1 lbs to get 1.0 lb deposit
 Deposit cost = $ 15.40/lb

▫ Good Wire is Cheaper than Cheap Wire!

(+40% unit cost) (- 9% deposit cost)